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Global trade conference includes FTA critiques
 
By RACHEL LANE
D.C. Correspondent

WASHINGTON, D.C. — In the United States, talk of free trade agreements (FTAs) typically focuses on how they impact here at home. At the Emerging Issues in Global Animal Product Trade Conference in Washington, D.C., the session panelists were from a variety of nations.

Panelist Ted Bilyea, a member of the board of directors for the Canadian Agri-Food Policy Institute (CAPI), said it’s taken a number of years, but the Canadian agricultural industry is beginning to feel the North American Free Trade Agreement (NAFTA) has greatly benefited the United States – but been much less beneficial to Canada.

“Essentially, we’re sending cattle to the United States, where it’s slaughtered, boxed up and sent back,” Bilyea said.
With the Trans Pacific Partnership (TPP), the U.S. has not considered Canada, he said. It is a concern, but he said it potentially allows Canada to enter markets more quickly than the U.S. because of Canada’s smaller industry – the Canadian agricultural industry can make changes quicker than the U.S. market can.

The TPP is of little interest in Canada unless Japan joins. Currently, Japan is part of discussions but has not committed to joining. It has strict requirements for sanitation and transparency on labels – both are things the smaller Canadian industry can pull off more quickly than the U.S., Bilyea said.

Guillermo Maynez Gil, the president of the Mexican Meat Council, said some states in Mexico are already exporting to Japan. Gaining access to the market required the Mexican agriculture industry to grant the Japanese the right to inspect facilities. The Japanese inspectors regularly check the factories to make sure everything is up to standard. “It’s not worth exporting cheap products to Japan. If you’re going to go there, you have to go with high quality,” Maynez Gil said.

He said the FTAs the Mexican government has entered have been good for the country. “For the processing industry, it’s been not just good, but strategic,” he added.

There are more products on the shelves of the stores in Mexico as a result of FTAs. Mexico imports meat from the United States, and the value of the country’s exports grew.

In 2003, when the first case of Bovine Spongiform Encephalopathy (BSE), or “mad cow disease,” was confirmed in the U.S., many governments banned American beef imports. As a result, revenues dropped $2 billion.

At the same time, sales of pork products increased, but the recovery of the U.S. beef export market was slow, reported Fawzi Taha and William Hahn, with the USDA’s Economic Research Service Market and Trade Division. Last year was the first year beef exports rose to pre-BSE levels.

Brett Stuart, founding partner of Global AgriTrends, said Vietnam has potential to become the biggest importer of U.S. meat products. It already imports more than $200 million annually in dairy, beef and veal, with an increasing need for meat and dairy products.

“The TPP offers a chance to strengthen sanitary agreements … if we get those agreements in place now, we’ll be well-placed in the future,” Stuart said.

He said the United States needs to work with Canada and Mexico to form a more cohesive NAFTA unit. If we don’t make agreements here, the meat of all three countries will be on the shelves of other countries, moving the competition there.

“We do want to benefit our industries, but it is a trade. We need to work together,” said Casey Bean, with the USDA Foreign Agricultural Service.
10/10/2012