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CCA Reports – for Feb. 9, 2009

Brad

Wildeman is president of the Canadian Cattlemen’s Association

Barely one month into 2009, a lot is happening. Many issues the Canadian Cattlemen’s Association (CCA) has worked on for a long time are now coming together.

International markets closed for some time to Canadian cattle and beef now show some signs of movement toward opening. In the recent G20 meetings, international leaders reached a consensus on weathering the global economic slowdown, stating countries must avoid taking protectionist trade actions. Remember that during economic discussions at the G8 Summit in Ottawa, many of the same leaders also committed to increase trade opportunities and improve market access. As two-thirds of our income depends on exports, indications our international counterparts want to work together is encouraging news.

World experts predict exponential growth in demand for meat and beef products. Canada is ideally positioned to supply beef into these markets, as most of these emerging economies don’t have the capacity to produce enough beef and cattle for domestic consumption. Despite North American economic troubles, other economies continue to grow. For instance, although China’s economy slowed down, it still reports growth between seven and eight per cent. Tremendous export opportunities await us and once we work through our trade issues, we stand to be the preferred supplier.

We received rewarding news when the federal government announced it will establish an export market-access secretariat aimed at aggressively and strategically regaining international markets lost to BSE. This is only one of several recommendations that the federal government adopted from the enhanced market access strategy we presented, with our industry partners, at the Beef Value Chain Roundtable meeting last November. This comprehensive export market-access strategy’s 25 recommendations could provide a template for other Canadian agricultural exports worldwide. With the negotiating efforts of the secretariat’s trade experts, industry and government will work cohesively on trade initiatives to promote Canadian cattle and beef and restore secure, economically meaningful access.

We continuously consult with the Government of Canada to enable this kind of responsiveness and ensure the interests of livestock producers are protected long term. We are grateful that the federal government asks for our input and even more encouraged that they have quickly turned this into reality.

Keeping up to date on COOL

In mid-January, the United States Department of Agriculture (USDA) issued the final rule for mandatory country-of-origin labelling (COOL). However on January 20, the Obama Administration notified that all regulations not in effect at the time he took office were to be reviewed. It may still turn out that the rule proceeds as is on March 16 but the door is open for the effective date to be pushed back; for a public comment period and potential changes to the rule. At this point, it is premature to speculate that the flexibility gained in the final rule for “B” and “C” cattle will be revised.

The rule’s waiting period for implementation, 60 days after its January 15 publication date in the U. S. Federal Register, may be potentially extended an additional 60 days. If the USDA decides to make this delay to the COOL rule, they would undertake a 30-day public comment period. If the comments raise issues of law or policy, the USDA could consider revisions which could well extend beyond the 60-day delay. Since pro-COOL organizations are already lobbying for policy changes, we are concerned that if a decision to delay is made, the delay could be indefinite. The interim final rule would remain in effect until the final rule is reissued.

We hope that upon reviewing the rule, Secretary Vilsack will reach the conclusion that the published final rule is the result of some seven years of Congressional and Administration effort and extensive public consultation to seek a compromise amongst the organizations that both advocated and opposed COOL. It is a compromise that no side is happy with and certainly we retain many concerns. We hope that at this point, the Secretary will conclude that the rule has been developed according to all applicable laws and has allowed all parties more than ample opportunity to express their views into the official record. We further hope he will decide to let the rule come into effect, injecting some much needed certainty into the market.

Naturally we have many questions about this development. We’re seeking clarity and will continue to work with the Government of Canada and our industry partners to minimize the negative impact this creates for the Canadian livestock and meat industries.

Breakthrough trade agreement made with Hong Kong

Canada continues to forge ahead, globally, to regain and increase international market access. It took a significant step forward last month when federal Agriculture and Agri-Food Minister Gerry Ritz, announced an agreement, in-principle, with Hong Kong. Based on a staged compliance process, by year-end this agreement significantly expands Canadian beef producers’ access to the Hong Kong market, possibly doubling Canada’s exports over 2008 levels.

The new agreement sends a strong market signal to other nations that Canada intends to reopen and expand commercially viable trade in line with the World Organization for Animal Health (OIE) recommendations that full trade should resume of Canadian beef, provided specified risk materials are removed. In other words, it’s time other nations review their export restrictions and show more flexibility if they want Canada to apply the same rule of thumb to their exports.

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