JAPAN BEEF PRICE SUPPORT CUT WILL NOT RAISE DEMAND Japan's plan to cut beef intervention prices for the fiscal year starting April 1 will not boost demand because of strict supply controls and a complex distribution system, Japanese and U.S. Industry sources said. "Government beef policy protects farmers rather than meeting consumers' demands and the cutback ... Is too marginal," a Housewives Association of Japan official said. Despite mounting U.S. Pressure on Japan to open farm markets, beef is strictly controlled by the government, which maintains a price stabilisation zone to protect farmers. Under the plan, expected to be announced this month, the standard or bottom price of castrated wagyu -- known as marbled beef -- will be set at 1,370 yen per kilo for 1987/88 against 1,400 now, and the ceiling at 1,780 yen against 1,820. The standard price of other beef, mainly produced from dairy steers, is set at 1,020 yen against 1,090 and the ceiling at 1,325 against 1,420. Ministry officials said the semi-government Livestock Industry Promotion Corp (LIPC) conducts buffer stock operations to help keep wholesale beef prices within the intervention price zone. The LIPC is allowed to import most beef, with the amount set by the government under a quota system. When wholesale prices go above the ceiling, the LIPC releases its beef stocks, both domestic and imported, and buys locally produced beef when prices are below. But the LIPC has often been criticised for releasing beef stocks when the prices are higher than the ceiling. Phillip Seng, Asian Director of the U.S. Meat Export Federation, told Reuters the two pct cut in prices is a step toward closing the gap with European Community prices, about half those in Japan. But Seng said the cut will not benefit consumers or U.S. Meat exporters because of Japan's rigid and complicated distribution system and strict supply control by the LIPC. The Housewives Association official said retail beef prices are high mainly because of distribution problems and high production costs, as well as poor operations by the LIPC. American meat packers see Japan as a promising market. F.C. Beatty, of U.S. Packer John Morrell and Co, told the Japan Times beef cuts, which sell for 1.20 to 3.00 dlrs a pound in the U.S., Are sold at 15 to 30 dlrs in Japan. But Seng said the cut will not benefit consumers or U.S. Meat exporters because of Japan's rigid and complicated distribution system and strict supply control by the LIPC. The Housewives Association official said retail beef prices are high mainly because of distribution problems and high production costs, as well as poor operations by the LIPC. American meat packers see Japan as a promising market. F.C. Beatty, of U.S. Packer John Morrell and Co, told the Japan Times beef cuts, which sell for 1.20 to 3.00 dlrs a pound in the U.S., Are sold at 15 to 30 dlrs in Japan. But industry sources said it is unclear how much demand will pick up if retail beef prices drop following any sharp reduction in intervention prices. U.S. Agriculture Secretary Richard Lyng said this week he will ask Japan to remove all beef import restrictions when he visits here next month. In 1984, Japan decided to increase its beef import quota by 9,000 tonnes a year until March 31, 1988. In 1987/88, the quota will rise to 177,000 tonnes from 168,000 in 1986/87, ministry officials said, adding Japan wants to keep self-sufficiency in beef at around 70 pct.