Fas Usda Thailand Bans U.s. Beef 2003
U.S. Beefiness Trade Disruptions
Many factors impact beefiness merchandise, such as environmental, economic, social, biological, and government regulations. Consequently, changes to these factors can lead to substantial disruptions in trade. Ane notable disruption to the U.S. beef trade market place was the discovery of the beginning case of Bovine Spongiform Encephalopathy (BSE) in the U.s.a.. A more contempo (and ongoing) trade disruption has been the use of hormones and beta agonists in U.S. cattle production. The following commodity discusses these issues and their impacts on U.S. beef exports.
BSE was offset discovered three decades agone and has essentially affected the world beef manufacture. The disease is carried in the brain and venous tissue of cattle and is linked to the fatal human variant Creutzfeld-Jacob Disease. The beginning case was located in the United Kingdom in 1984 although it was not officially identified every bit BSE until 1986. In 1987 evidence was found that BSE could be transmitted through the practice of feeding meat and bone repast (MBM) to cattle. Equally a result of international concerns, the United States Department of Agronomics (USDA) implemented a tracking do in 1990 to monitor imports and a formal policy restricting high-chance products from being imported from countries known to accept BSE (Coffey et al. 2005). The Food and Drug Administration established a ban on all high-adventure mammalian products to be included in feed ingredients by 1997. In May, 2003 a BSE case was reported in Alberta, Canada and the United States responded by banning all imports of live cattle from Canada.
On December 23, 2003, a dairy cow in Washington State tested positive for BSE. The cow was quickly discovered to have been from Canada just 53 countries immediately banned imports of U.S. beef and beef products. Coffey et al. (2005) estimated that the associated costs to the beef industry due to BSEfor the year 2004 alone were $200 million. There was also a pregnant decrease in sales volume and price (Coffey et al. 2005). Total beef exports from 1990 to 2013 are presented in Figure ane. These information are annual value of fresh, chilled or frozen beef and veal products (Figures ane, 2 and 3) obtained from the USDA Foreign Agricultural Service Global Agricultural Trade System (GATS 2014). Beef exports totaled $3 billion in 2003. BSE export bans caused full beefiness exports to decline 83% in value from 2003 to 2004. Since 2004, the United States has been repairing the beefiness consign market. From 2004 to 2013 U.S. beefiness exports accept grown nearly tenfold, to over $v billion in 2013, well to a higher place pre-BSE levels (72% increase from 2003 to 2013).
The top v consign destinations for U.S. beefiness products in 2013, Japan, Canada, Hong Kong, Mexico and S Korea, are presented in Figure 2 (GATS 2014). Prior to the U.S. BSE incident, Nihon was the meridian export destination accounting for over 61% of the full exports in 2003. Post-obit the discovery of BSE in the United States, Japanese regulators closed their markets to all imports of U.S. beef. In 2005, Japan began allowing some imports of U.S beef from cattle 20 months of age and younger. After opening merchandise, exports to Nihon rose from about $v million in 2005 to $903 million in 2012. In February 2013, Japan began allowing imports of U.Due south. beef from cattle 30 months of age and younger. Consequently, exports to Nihon rose over 30% in 2013 making them once again the top export market for U.S. beef. Despite rising retail beefiness prices due to the express supply of cattle in the United States every bit well every bit changing exchange rates, demand for U.Southward. beef in Nippon has stayed relatively strong. Currently (January through August, 2014), the U.s.a. has exported well-nigh $850 million in beef to Nihon, slightly to a higher place terminal year's level of $845 million (January to August, 2013).
The most recent trade disruption in beef products is the use of hormones and beta agonists in cattle production. The European union bans the use of both hormones and beta agonists and maintains merchandise restrictions on U.Southward. beef. Russia and Prc too maintain a zero tolerance policy for the presence of residues of hormones and beta agonists in beef and employ trade restrictions to U.Southward. beef. U.Southward. producers that currently consign to the Eu have to certify that their products are complimentary of these substances; however, U.Southward. producers take been unwilling to do the same for Russia.
Exports to Russian federation and China from 1990 to 2013 are presented in Figure iii (GATS 2014). It is interesting to annotation the changing pattern of trade with these ii countries. Figure three shows the impact of the BSE trade ban in 2004 and how around the aforementioned time the beta agonists restrictions started to bear on merchandise. In the case of Russia, we observe how the consequences of the 1992 economic reforms after the dissolution of the Soviet Matrimony (removal of some subsidies and fall in income) set up the phase for an increase in beef products imports from the The states (Osborne and Trueblood 2002). Yet, the trend did not concluding long and exports started to decrease in 2000, from $70 meg in the peak year 1999 to $8.six million in 2003. Merchandise in beef products resumed in 2008 to attain a new tiptop in 2012 of $250 million only to stop the post-obit year, 2013, after Russia prohibited imports of all U.Due south. beef, pork, turkey and other meat products because of the use of beta agonists in cattle product (USDA 2013). In the case of China, nosotros observe how as income rises, demand for U.S. beefiness products slowly increases in the early-1990s and chop-chop increases in the late-1990s, peaking in 2002 with $14 meg in beef products (right later on China's accession to the World Merchandise Organization (WTO)). Yet, U.S. beef exports to Cathay have remained very low since 2004 (under $1 one thousand thousand and in virtually years closer to zero) because of the BSE incident and concerns over the utilise of hormones and beta agonists in cattle production.
Trade restrictions have acquired major disruptions to the U.South. beef industry over the years. U.South. beefiness exports have rebounded beyond pre-BSE levels, and consequently, hereafter trade disruptions could have a larger impact on the U.S. cattle manufacture than previously seen. Affliction issues and controversial product practices take the potential to abruptly disrupt trade for an indefinite fourth dimension. Notwithstanding, there is a fundamental difference between BSE and the use of hormones and beta agonists in cattle product. While BSE in cattle has been scientifically linked to the fatal human variant Creutzfeld-Jacob Affliction, there has been no accustomed scientific proof of impairment caused to humans past the apply of hormones or beta agonists in cattle product. The European Spousal relationship and other countries oft apply the precautionary principle to nutrient prophylactic issues. Co-ordinate to the WTO, the precautionary principle allows countries to implement "protective activity before in that location is a complete scientific proof of a risk" (WTO 2014). Understanding how unlike restrictions impact U.S. beefiness merchandise is important.
Kate Brooks
Livestock Marketing Specialist
UNL Ag Economics Department
kbrooks4@unl.edu
402-472-1749
Lia Nogueira
Banana Professor
UNL Ag Economics Department
lia.nogueira@unl.edu
402-472-4387
Jacob Birch
Graduate Banana
UNL Ag Economic science Department
References
Coffey, B., J. Minert, S. Fox, T. Schroeder, and L. Valentin. 2005 "The Economic Impact of BSE on the U.Due south. Beef Industry: Production Value Losses, Regulatory Costs, and Consumer Reactions." Livestock Economics, MF-2679, Kansas State Academy Agricultural Experiment Station and Cooperative Extension Service. May 2005.
GATS. 2014. USDA Foreign Agricultural Service Global Agricultural Trade System. Accessed September 2014. http://apps.fas.usda.gov/gats/
Osborne, S. and Thou. Trueblood. 2002. "Agronomical Productivity and Efficiency in Russian federation and Ukraine: Building on a Decade of Reform." Agricultural Economical Written report No. 813.
USDA. 2013. Argument by U.S. Agronomics Secretary Tom Vilsack and U.Due south. Trade Representative Ron Kirk on Russia'southward Suspension of U.Due south. Meat Exports, February 11, 2013. Accessed October 2014. http://www.usda.gov/wps/portal/usda/usdahome?contentid=2013/02/0023.xml
WTO. 2014. "The Precautionary Principle." Accessed October 2014. http://www.wto.org/english/tratop_e/sps_e/sps_agreement_cbt_e/c8s2p1_e.htm
Source: https://agecon.unl.edu/cornhusker-economics/2014/u.s.-beef-trade-disruptions
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