Jan 8, 2010


The bovine spongiform encephalopathy (BSE) incident of eight years ago was starting to look like just a bad dream, but it seems to keep coming back even though the U.S. has only two domestic cases recorded. It is such a small issue anymore for the U.S., it’s surprising that anyone would want to make an issue over it at all. However, that’s not the case.

Last week, the Taiwan government made the decision to ban some beef products from their market based on food safety risks associated with BSE. Taiwan has been importing U.S. boneless beef for the past six years and agreed to start taking under-30-month bone-in beef in October last year.

Taiwan only imports $128 million worth of beef products from the U.S., so it’s not a terribly large market for our industry. But the fact that they reneged on a trade agreement with the U.S. is more troublesome. The Taiwanese government was provided with all the information and science to justify resuming beef trade with the U.S. Their own scientists backed the plan. But a new nationalistic parliament changed their minds recently and attributed the shift to safety concerns, despite the fact that there are none. Apparently, public pressure had more to do with the issue than science.

Taiwan agreed to an import protocol for beef that was negotiated according to the guidelines laid out by the World Organization for Animal Health, as well as Taiwan’s own risk assessments, which concluded U.S. beef is safe. They agreed to take bone-in beef over 30 months of age with all the Specified Risk Materials removed. This is becoming pretty standard protocol and is accepted by more countries as time moves on.

It’s kind of crazy for Taiwan to make an issue out of something that isn’t really an issue. Taiwan has been a U.S. trading partner for decades. We even sell them arms to defend themselves against China, which doesn’t recognize the Taiwanese government and would like to have them under Chinese rule.

We haven’t heard too much from the U.S. government on this deal. President Obama, with Foreign Ag Service Undersecretary Jim Miller and U.S. Trade Representative Deputy Demetrios Marantis, said in a joint statement that: "We are deeply concerned and disappointed by reports that Taiwan’s Legislative Yuan has taken initial steps toward the passage of provisions that would unjustifiably bar the import of certain US beef and beef products."

That statement doesn’t sound like the administration is too concerned about beef trade and I wouldn’t be surprised if they aren't concerned about any trade at all. The Obama administration hasn’t been terribly aggressive on any trade deals that are pending.

Former Secretary of Agriculture and current Senator from Nebraska Mike Johanns was a bit stronger in his statement, saying: "This is an unfortunate and unnecessary setback in our relations with Taiwan. I’m disappointed that they are reversing their position on an agreement we just signed and I will work with the Obama administration to resolve this important issue for Nebraska and other beef producing states."

At the end of the day, protecting the integrity of this trade agreement is more important than shipping some ground beef and edible offal to Taiwan which may increase beef sales a few million dollars. In fact, over the past year, beef sales to Taiwan are actually the best they’ve ever been. The problem is that Taiwan has a weak president who has made many bad decisions and the politics are against him more than they are the U.S.

Unfortunately, the U.S. beef industry always seems to get in the crossfire of these political battles, just like we did when South Korea was ready to open up.

The big problem occurs when trade agreements are made with other countries. It’s a highly diplomatic process and once they’re signed, it’s not acceptable to arbitrarily turn around and void them at the first possible opportunity. Another possible concern is that some of the parties in other Asian nations, who may also have problems with U.S. beef, may look at what Taiwan has done and use it as a reason to follow suit.

I understand that everyone on Capital Hill is mad about this issue, but we may just have to wait this one out until Taiwan gets a new president, which seems like a sure bet. — PETE CROW