RESTRICTEDWORLD TRADE
ORGANIZATIONG/STR/Q1/JAM/5
5 May 1998
(98-1786)
Working Party on
State Trading EnterprisesOriginal:  English
STATE TRADING
Replies to Questions Posed by the UNITED STATES1
Concerning the Article XVII Notification of JAMAICA2
The following communication, dated  29 April 1998, has been received from the Permanent
Mission of the United States.
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Q.1. For the Coconut Industry Board, Jamaica reports under part (c) of functions of the
Board that the Board arranges for issuing licences for manufacturers.  Could Jamaica report on
the criteria for issuing a licence?
Criteria for Issuing Licence by the Coconut Industry Board (CIB)
A.1. The Coconut Industry Board operates subject to  the powers of the Minister of Agriculture.
All applications for licence by commercial copra manufacturers are approved unless the CIB
views the venture as one that would be uneconomical.
For small scale private manufacturers no licence is needed.For the importation of edible oils no licence is refused by the Coconut Industry Board.
For the manufacturing of coconut oil the power of licensing rests with the Ministry of
Agriculture.
All applications for licences are submitted to the Coconut Industry Board by the commercial
copra manufacturers.  The applications are approved by the Board of Directors based on the following
conditions.
- The Copra manufacturers must make a deposit with the CIB equivalent to one week's
supply of coconut.  Interest is paid on this deposit at the average rate earned onmoney invested by the CIB.
- The copra manufacturing account must be separate from all other operational
accounts.
- Growers must be paid within 14 days of delivery of coconut to the factory.
                                                     
1G/STR/Q1/JAM/1 and G/STR/Q1/JAM/2 & Corr.1.
2G/STR/N/1/JAM.G/STR/Q1/JAM/5
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Q.2. For the Coconut Industry Board, Jamaica reports under part (d) of functions of the
Board that the Board markets the coconut crop.  Could Jamaica explain what activities the
Board engages in (e.g., sales, licences, promotion, etc.) and if the Board has any special or
exclusive rights or privileges?
A.1. The Coconut Industry Board (CIB) does engage  in sales, licences and promotion of the
coconut crop.
The CIB is the only legal entity in Jamaica au thorized to buy or sell copra domestically or
internationally.
The United States Department of Agriculture a year ago gave the CIB exclusive rights to ship
seed coconut for nursery purposes into the United States.
These rights are now extended territorially to include Costa Rica and Puerto Rico.
The estimated production of coconuts for the period January to December 1996 was
14.34 million coconuts.
Q.3. For the Sugar Industry Authority, Jamaica reports under part (4) of Functions of the
Board that it has the authority to issue export licences.  Could Jamaica explain the criteria for
granting a licence?
A.3. In the amended Act there is no reference in part (4) to the Authority issuing export licences.
Sugar producers can export sugar in their own right after preferential quotas and domesticrequirements are satisfied.
Q.4. For the Petroleum Corporation of Jamaica (P CJ), Jamaica reports under part (ii) of the
functions of the PCJ that it imports, exports, refines and distributes petroleum and petroleum
products.  Could Jamaica explain the criteria for importing or exporting, and how prices are
determined for these transactions?
A.4. (a) Jamaica through the Petrojam Refinery imports its crude oil and products needs under
the San Jose Accord from Venezuela and Mexico.
(b) This Accord allows Jamaica to import 160,000 barrels per day from both Mexico and
Venezuela.
(c) Crude oil and product prices are based on the Mexican and Venezuelan posted prices.(d) The importation of petroleum crude oil and products has been liberalized since 1994.
(e) Imports outside the CARICOM region attracts a Common External Tariff of 5 per
cent on crude and 15 per cent on products.
(f) Export of petroleum products from Jamaica has been very limited in recent times.
(g) The price structure for any export would be based on the refinery billing price less
any rack charges.
(h) Attached please find the pricing structure for sales by the refinery to the marketing
companies.G/STR/Q1/JAM/5
Page 3
Petroleum Products Prices are based on Current Refinery Pricing Formula
1. Reference Price (Related to US Gulf Prices)
2. Acquisition Difference
3. L/C Charge
4. Freight
5. Insurance6. Ocean Loss
7. CET (Common External Tariff)
8. Terminal Fee
9. Freight Equaliz
10. Rack Fee
11. Consumption Duty
12. Add Con. Duty13. Refinery Billing
14. Average Marketers Margin
15. Average Marketers Price
16. Average Haulage Rate
17. Average Retailers Margin18. Average Retail Price
Q.5. We note that the Jamaica Commodity Trading Company (JCTC) continues to handle all
imports of P.L. 480 rice, and that this rice is currently resold to only one company, Grains
Jamaica Ltd.  Could Jamaica explain why this company is the only miller of P.L. 480 rice?  In
the future, does Jamaica intend to increase the numb er of millers that it will sell to?  If not,
why?
A.5. It is correct that Jamaica Commodity Trading Company (JCTC) continues to handle all
imports of PL 480 rice and that the rice is currently resold to only one company Grains Jamaica
Limited.  Grains Jamaica Limited is the only miller of PL 480 rice because it is the sole rice miller in
the country.  It should be further noted that Grains Jamaica has given a commitment to purchase PL480 rice regardless of the price.
A contract now exists between JCTC and Grains Jamaica Limited for the supply of PL 480
rice.  Should new rice milling companies be established a revisiting of the contractual arrangement
with the sole miller would become necessary.
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