Europe ends beef trade war with U.S., Canada

News
Mar 16, 2012
by WLJ

Europe ended the twodecade beef trade war March 14 with the U.S. and Canada over beef. Though still maintaining its ban on beef from animals treated with any number of common feed supplements, broadly and indiscriminately dubbed “hormones,” Europe increased imports of high-quality meat from the two countries.

The European Parliament voted 650 to 11 in favor of a deal to resolve the dispute, which erupted in 1988. At the time, the U.S. and Canada limited imports of certain European Union (EU) products with the backing of the World Trade Organization.

Although the conflict over treated beef involved a relatively small amount of trade, it led to trade reduction that had significant repercussions on both sides of the Atlantic. Close trading partners got entrenched in a lengthy and unconstructive trade dispute. Continued application of retaliatory duties on certain European products hampered exports and EU producers subsequently suffered a loss of market share.

The destructive dynamics of trade sanctions was ended through bilateral negotiations between the countries and resulted in a so called Memorandum of Understanding which began in 2009. Prior to the Understanding, the U.S. and Canada primarily targeted beef and pork products, with the U.S. also sanctioning Roquefort cheese, truffles, toasted breads, juice, mustards, jams, chocolate, soups and other luxury food products.

Since 2009, a gradual lifting of sanctions imposed on EU agricultural products by the U.S. and Canada has occurred. In exchange, American and Canadian beef exporters have received an autonomous, zero-duty, tariff-rate quota for high quality beef not treated with products judged objectionable by the EU. The deal will see the 27-nation European Union increase imports of hormone-free U.S. beef by 25,000 tons, bringing the annual total to 45,000 tons.

EU advisory sources have praised the actions on both side of the Atlantic as a winwin situation for everyone involved. They have also warned EU governments that since the U.S. and Canada have already suspended all retaliatory sanctions in the course of 2011, failure to honor the deal on the European side could have very negative political consequences and would do damage to the transatlantic trade relationship. — WLJ

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