The proposed reopening of the US-Canadian border for live cattle exports on 7 March will be a major boost for trade but questions remain about North America’s ability to prevent future cases of mad-cow disease. Meanwhile in Europe all talk is of BSE and goats, as David Robertson reports.
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The border was shut after Canada discovered its first case of mad cow in May, 2003. That discovery has cost the Canadian beef industry an estimated C$5bn (US$4.06bn), and US meat packers have also suffered.
The lifting of sanctions is therefore of huge economic importance to both countries, although the US Congress has raised doubts about the timing of the border reopening after another case of mad cow was discovered in Alberta last month. Subject to politics, however, it appears that the 7 March date will be honoured.
For the US, normalising trade relations with Canada is more than about just being a good neighbour – it is also a demonstration that the US Department of Agriculture (USDA) feels its new guidelines on removing mad cow from the food chain are working.
The US is hopeful that its new measures will persuade the large number of countries that have banned US beef (after a single case of mad cow was discovered in Washington State during 2003) to lift their sanctions. This would have significant implications for world beef prices and US trade.
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By GlobalDataHowever, many consumer advocates feel that the US is still not doing enough to prevent mad cow reaching the consumer.
Millions of animals slaughtered
Bovine spongiform encephalopathy (BSE) – or mad cow disease – has caused enormous problems for cattle farmers in countries all over the world. It emerged in the UK first, during the mid 1980s, and British farmers have been forced to destroy millions of cows to eliminate the disease.
By the end of the 1990s some 170,000 cattle in the UK had been diagnosed with BSE and 137 people have died from the human variant, Creutzfeldt-Jacob disease (CJD). In total 148 people are believed to have died from CJD worldwide.
Throughout Western Europe cattle have been identified with BSE and other countries like Poland, Israel and Japan have also been affected.
Mad goat disease
BSE hit the headlines again earlier this month when the European Union confirmed that the first case of mad goat had been found. Although the goat case is thought to be exceptional, the EU will test some 200,000 animals just in case.
Outside the UK, however, BSE has caused little real damage to consumer health – although that has not stopped widespread concern about the disease, which seems to have caught the imagination in a far greater way than other meat-borne diseases like e-coli.
The UN Food and Agriculture Organisation, which is working in many countries to prevent outbreaks of BSE, reminded the public earlier this month that the very small number of cases in countries like Canada, the USA and Japan “should not cause panic among consumers and producers”. The UNFAO also described the mad goat case as “one example in millions”.
Protectionism in play?
The real impact of BSE has been on trade, where it has become a convenient excuse to prevent big beef producers like the USA from exporting. The single case of American mad cow prompted 40 countries to ban beef imports from the US.
The effect of this has been dramatic: the price of livestock fell from 97c per pound to 79c early in 2004. Restaurants, particularly the giant chains like McDonald’s, saw sales fall and meat processors had to lay workers off.
Japan’s decision to ban US imports has cost America an estimated US$1.7bn in lost earnings. South Korea’s ban has cost about $815m. And despite negotiations, many countries are refusing to drop their sanctions (China, Hong Kong, Thailand, Malaysia etc.). The Philippines and Indonesia have lifted their bans and Japan is moving slowly towards reopening its borders.
Of course, not everybody loses because of trade sanctions: the Australian beef industry saw the value of its exports rise 18% to A$4.2bn last year.
Fighting back against ‘unfair’ sanctions
In a bid to win back export markets, and also reassure domestic consumers, the USDA has introduced a series of new measures designed to prevent BSE getting into food. This includes banning brains, spinal cords and small intestines from human food products, increasing cattle testing by a factor of ten, increasing the number of inspections of feed mills and rendering plants and a tightening of rules governing what can go into animal feed.
These measures, the industry argues, have created a stringent regime that should guarantee the safety of US beef. There is some anger in the US that many countries have not dropped their sanctions following the introduction of these new rules.
Karen Batra, a spokeswoman for the National Cattlemen’s Beef Association, said: “The decision to halt trade of beef products when a case of BSE is discovered is relatively standard operating procedure. However, the indecision by some of our trading partners to resume trade nearly 14 months after discovery of the first US case (later determined to be of Canadian origin) is frustrating. We have provided detailed documentation of our BSE prevention and monitoring systems; US officials at all levels of our government (including our President)have met with foreign officials in countless meetings for both political and technical discussions; We have tested over 210,000 animals in an expanded surveillance programmr and not yet discovered an additional case; Yet, some of our trading partners continue to drag their feet on this issue despite their own consumers expressing a need and want for US beef.”
However, consumer advocates are not so impressed by the USDA’s new measures. Organisations like the Center of Science in the Public Interest and the Government Accountability Project have asked why the USDA didn’t act to protect consumer health earlier, particularly as the UK and other European countries introduced similar rules years ago.
They also argue that the rules for animal feed could be tightened further and they point out that the USDA’s plan to test 220,000 animals for BSE is a drop in the ocean – America has a cattle population of 95 million. Northern European countries like France, Germany and the UK test millions of cattle a year.
But given the miniscule risk of a person catching CJD it is perhaps not surprising that cattle farmers are unwilling to invest millions (if not billions) of dollars in testing and new feed arrangements.
Despite their reluctance, however, the beef industry (whether it be that of the US, Canada or Europe) will do whatever is necessary to keep export markets open and if that means further tightening of the rules then so be it. And this can only be good news for consumers.
