The U.S. cattle herd, reflecting six straight years of Americans’ declining beef consumption, hasn’t been this small since 1952, three years before Ray Kroc opened his first McDonald’s restaurant.
It’s just one sign of the discouraging news at home and abroad for U.S. beef producers. China won’t ease a nearly 10-year-old ban on U.S. beef. A new case of mad cow disease this spring in California only made consumers throughout Asia more uneasy, and South Korea, among others, stepped up inspections of U.S. beef.
In Taiwan, another promising market for U.S. beef and pork, lawmakers are debating whether to allow imports of any meat containing even trace amounts of ractopamine, a feed additive used to promote leanness in cattle and pigs.
Total U.S. beef exports by volume plunged 10 percent in the first five months of the year from 2011’s record levels. On the bright side, the value of those exports increased 5 percent year-over-year.
Some analysts say having a trade agreement in place forces government officials to deal with a situation using world trade laws and accepted science, rather than domestic political concerns.
“We were pleased with the reactions of our trading partners after the latest case of BSE (bovine spongiform encephalopathy, or mad cow) was discovered,” said Joe Schuele, communications director for the U.S. Meat Export Federation. “But I wouldn’t say it was because a trade agreement forced anyone into a certain position. I think we’ve seen over the last decade more understanding about the disease, our industry safeguards and the fact that it is on its way to eradication.
“This was our first case in years, but there have been cases in other countries, and the trade impact seems to be less and less each time,” Schuele said.
In Taiwan, lawmakers appear poised to accept U.S. beef containing ractopamine at World Health Organization-accepted levels, but are firm in their commitment to maintaining a zero tolerance for ractopamine in pork. “The difference there isn’t a scientific standard; it’s political,” Schuele said. “There isn’t much of a domestic beef industry in Taiwan, but they have a domestic pork industry that isn’t allowed to use ractopamine.”
The USMEF’s position on ractopamine and BSE is simple: “We want our trading partners to set policy based on international scientific standards,” he said.
A joint food standards committee of the WHO and the U.N’s Food and Agriculture Organization this month finalized global standards for acceptable levels of ractopamine in meat.
Taiwan’s Legislature is scheduled to debate an amendment to its food safety laws that would accept trace amounts in beef, but pork isn’t in the measure. Opposition politicians say they won’t filibuster the measure as they did during the last legislative session.
There’s another reason for lower exports this year, Schuele said: Sales have been so strong recently that it was difficult to maintain the pace.
Although downplaying the effect trade agreements have had in maintaining smooth trade relations, Schuele said the USMEF is anxious to see more agreements. “On the beef side, we would love to have direct access to China, the world’s largest market,” he said. “That’s something the U.S. continues to work on, but I don’t have any idea on a timetable. Unfortunately, beef has become entangled in a number of other trade issues with China and hasn’t had an opportunity to stand on its own.”
A big trade issue for both beef and pork in many countries is high tariff levels, he said. “Tariffs for beef in Japan are 35 percent, and when production costs are high, it’s hard to sell competitively with that level of tariff. We have a new trade agreement with Korea, but the level there started at 40 percent and it’s coming down only 3 percent a year, so it is still high. It takes a while to come down enough to make a difference.”
As production costs increase for U.S. meat producers and consumption slides at home, Schuele said export markets would only become more important to U.S. farm income.
Contact Stephanie Nall at email@example.com.