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Japan team wraps up USDA meeting on GM wheat situation

By Ros Krasny

WASHINGTON (Reuters) - A Japanese delegation is completing talks with the U.S. Department of Agriculture aimed at restarting purchases of U.S. western white wheat, which were halted after the discovery of an unapproved genetically modified strain growing in Oregon.

"USDA is hosting a team from Japan's Ministry of Agriculture, Forestry and Fisheries for technical discussions in support of the resumption of trade of U.S. western wheat," a USDA spokesman told Reuters.

Official talks are due to end on Wednesday, but the Japanese team will be in the United States until Saturday, USDA said, adding that it does not plan to provide further details.

U.S. merchants said a pickup in Asian demand helped the western white wheat market to gain this week, with prices higher at the Chicago Board of Trade. South Korea lifted its ban on U.S. imports this month, and Indonesia was a buyer, leaving Japan as the major holdout.

Japan, one of the world's largest and most consistent importers of wheat, has shunned the western white variety since USDA announced the GM discovery in late May.

Western white is the wheat variety used in Japan for cakes, cookies and other baked goods.

The Japanese delegation was expected to lay out in detail what they want to happen in the United States in order for imports of western white wheat to restart.

Japan wants USDA to test a composite sample of each western white shipment, and give shippers a letter that certifies the shipment has no GM wheat. Samples would also be sent to Japan for testing there, ahead of the arrival of vessels from the United States, according to industry officials there.

Reuters reported on July 8 that Japan hopes to restart the white wheat purchases as soon as August.

Japan continues to purchase other varieties of U.S. wheat at its regular tenders.

But its buyers are said to be eager to get the white wheat supply pipeline filled again before the peak import season in October and November, and to have enough flour on hand to bake the white cakes many Japanese traditionally eat at Christmas.

The wheat found in Oregon was a strain developed by Monsanto Co but never commercially available. Monsanto abandoned its GM wheat field trials in 2005, but stored the unapproved wheat in a Colorado facility at least until late 2011.

After a weeks-long investigation, USDA termed the Oregon wheat discovery "a single isolated incident" and said there was no indication so far that any biotech wheat was in the U.S. food chain.

(Additional reporting by James Topham in Tokyo; Editing by Kenneth Barry and Leslie Gevirtz)

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