Japanese Rebuff Pitch by U.S. on Farm Products : Agriculture Minister Says Ban on Rice, Limits on Beef, Oranges Will Remain

Agriculture Secretary Richard E. Lyng was rebuffed Monday in a bid to persuade Japan to open its market to American rice, beef, oranges and other food products.

Shortly afterward, U.S. Trade Representative Clayton K. Yeutter said the United States “will aggressively pursue” a solution to the dispute over Japan’s imports of agricultural products.

Lyng, with Yeutter sitting in, made the first official U.S. request for Japan to lift its ban on imports of rice, the most politically sacrosanct of the 22 agricultural items on Japan’s protected list. The request was made at a meeting with Mutsuki Kato, Japan’s agriculture minister.

Lyng urged Kato to set up a system of quotas under which specific amounts of rice could be imported from the United States.

He also reiterated long-standing demands for the removal of quotas on imports of beef and oranges, as well as on 12 other food products of lesser political impact, including tomato paste, peanuts and processed cheese.

Kato rejected all the requests. He told Lyng and Yeutter that Japan will not lift its ban on imports of rice because of rice’s pre-eminence in overall agricultural production and because it has “strong roots in Japanese culture.”

Moreover, he said, Japan will insist on retaining its quotas on the other products.

He promised, however, to discuss increasing beef and orange quotas after a bilateral agreement on those products expires next March 31. And he also agreed to allow Japan’s rice policy to be put on the agenda for the multinational trade talks that will take place in Uruguay under the General Agreement on Tariffs and Trade. But he said that agreement to discuss the ban will not lead to a lifting of it.

Monday’s meeting, which Lyng said accomplished nothing, began a series of last-minute consultations before Prime Minister Yasuhiro Nakasone’s scheduled April 29 visit to Washington. Japanese officials hope the visit will avert a crisis in the mounting economic difficulties between the two countries.

Yeutter issued his warning about Washington’s intent to “aggressively pursue” solutions to disputes with Japan in a speech Monday night to a conference of 80 prominent American and Japanese businessmen, scholars, politicians and journalists.

Will Pursue Solutions

“Individual trade issues are threatening to overshadow our long relationship as friends and allies,” Yeutter said. “This must not be allowed to happen.”

He cited a dispute over semiconductors and added that, “with a $170-billion trade deficit, we will aggressively pursue solutions in other disputes, too.” He listed these as agricultural trade, contracts for American companies to take part in the construction of a new Osaka airport, supercomputers, telecommunications and auto parts.

Yeutter likened the present situation to an earlier dispute with the European Economic Community--sanctions were ordered in January, but then withdrawn--and his remarks were taken as a veiled threat of retaliation against Japan.

He acknowledged that approval of the U.S. requests on all the matters at issue “would have only a modest impact on our massive trade imbalance.” But solving the disputes, he added, “will be worth the effort in terms of calming our relationship.”

Yeutter emphasized that it is important for Japan to carry out the recommendations made a year ago by a governmental commission headed by Haruo Maekawa, a former governor of the Bank of Japan. Maekawa’s report urged a thorough reform of Japan’s economy and Prime Minister Nakasone told President Reagan a year ago that Japan would do it. Nakasone promised to end Japanese industry’s dependence on exports and expand domestic demand.

Failure to carry out the recommendations will present “a bleak alternative,” Yeutter warned.