Trade deals need not be bad news for Europeans

Dire warnings against opening the floodgates to farm produce from north and south America are being trotted out again.

An EU trade deal has been agreed with Canada, talks continue with the US — and negotiations with Mercosur countries in south America haven’t gone away.

However, the deal with Canada reveals that trade agreements need not be bad news for most European farmers, as long as European consumers insist on high food standards.

In the case of Canada, it has had four years of access to the EU’s duty-free quota for high-quality, grain-fed beef, opening the way for 48,200 tonnes of beef in 2013. Yet, the EU has imported only 444t of Canadian beef in the first half of 2013. In the year to July, only about two-thirds of the quota was utilised, with the US the largest user of the duty-free concession, shipping 16,750t, but with major beef exporters, including Australia and Uruguay, unable to fully avail of this valuable access to the premium priced EU market.

In 2015, the EU-Canada trade agreement will allow duty-free access for 50,000t of fresh/ chilled and frozen Canadian beef, and Canada will continue to have access to the shared duty-free quota for high-quality, grain-fed beef.

It seems the US and Canada cannot find enough beef of a sufficiently high standard to export to Europe.

Sources in the US Meat Export Federation (USMEF) say that while the gains for Canadian beef in the agreement look good on paper, the actual impact may fall short of expectations.

And they say they are very concerned about the US similarly settling for larger beef quotas in a trade agreement with the EU, fearing it would have limited impact.

Instead, the jackpot for USMEF would be to get the EU to accept US beef from hormone-treated cattle, to “truly” open the EU market to US beef.

Otherwise, Europe is likely to remain a niche market, regardless of how much quotas are expanded, according to USMEF. However, EU trade negotiators are unlikely to risk the wrath of EU consumers by allowing in a flood of beef from hormone-treated cattle.

With a trade deal promising a multi-million euro annual improvement in the EU-US trade balance, negotiators might risk upsetting EU farm-ers in order to win valuable new non-food exports in a trade deal, but not at the cost of tens of millions of EU consumers protesting against allowing in hormone beef.

The Americans have eased long-standing restrictions due to BSE which were imposed on importation of beef from the EU.

They will be demanding a quid pro quo on technical barriers — meaning the EU ban on hormones for beef, which the US says is scientifically unsound. Scientifically un-sound or not, it is the right of EU consumers to insist on high standards for the food they eat, and that is a right which EU leaders would en-danger at their peril.

Instead, if EU leaders support their consumers’ anti-hormones stand, there is scope for Ireland and other EU member states to sell more of their top quality, sustainably produced beef to choosy US and Canadian consumers than the quantities that come in the other direction.

The free trade balance sheet also has a credit for export of 30,000 tonnes of specialised EU cheeses to Canada — but opening the EU to 75,000 tonnes of pork meat from Canada would be a significant debit, when the deal comes into effect in 2015.

Also worrying is recent talk of progress in Mercosur-EU trade talks.

But there may well be irreconcilable cultural differences also between these trading partners.

Brazil has drawn up a proposal for a co-operation and trade agreement with the EU. But it must first be submitted to other Mercosur countries, headed by Argentina — which seems more interested in taking the EU to the World Trade Organisation in a biodiesel row than in signing a trade agreement.


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