By MEGGIE. I. FOSTER
Assistant Editor
 
LOUISVILLE, Ky. — While the world is suffering from an economic recession, the agriculture industry deals with its own battles, including combating animal activists and promoting U.S. meats overseas despite continued recalls.

According to John Caspers, a pork producer and member of the U.S. Meat Export Federation (USMEF), exports for pork and beef products remain strong; however, issues still remain as a result of the BSE “Mad Cow” disease outbreak in 2003 and new hormone bans in the European Union (EU).

“The cost from BSE (bovine spongiform encephalopathy) in the U.S. was substantial and there were many export opportunities lost. We estimate $6 billion lost in Japan, $3.4 billion lost in Korea and hundreds of thousands of dollars lost in other countries, for a total of $10 billion,” said Caspers, who spoke during the National Institute of Animal Agriculture annual meeting on March 31 in Louisville.

Despite all, 2008 was reported as a “great year for beef exports” and 2009 production is expected to be stagnant.

“We anticipate that 2009 will be a challenging environment for beef and the industry will continue to see small year-to-year increases,” he added. “What happens in foreign markets is key here.”
Caspers commented that China and Korea are still slow to recover from BSE and subsequent beef bans.

“We still see a lot of challenges in Korea with a lot of consumer resistance to U.S. beef, and this has hurt us greatly. This has shown them (in the past six years) that they can do it (raise beef) without us, and they can,” he said.

For a bit of good news for beef producers, Caspers added “from a historical viewpoint, we’re seeing U.S. beef exports beginning to recover and approach pre-2003 levels.”

Another issue Caspers pointed out as a concern to USMEF and, ultimately, United States livestock producers is the EU hormone ban. In fact, for the past 15 years. the U.S. and the EU have been disputing the safety of growth enhancement drugs used in cattle. The disagreement over the use of hormones in cattle peaked in 1989 when the EU banned the import of beef from cattle treated with growth antibiotics, effectively cutting off U.S. exports of beef.
The U.S. has always maintained its beef from cattle treated with certain approved growth hormones poses no public health risk and therefore, the EU’s hormone ban is unjustified, according to Caspers. Numerous scientific studies and evaluations, including those conducted by the EU and CODEX – the international food safety standard-setting body – have supported the U.S. position.
 “This is a familiar story for us,” he said. “They’ve developed this based on a precautionary principle and as a test case for the SPS Agreement (Agreement on the Application of Sanitary and Phytosanitary Measures, an international treaty of the World Trade Organization).”

Under the SPS agreement, the WTO sets constraints on member-states’ policies relating to food safety, including bacterial contaminants, pesticides, inspection and labeling, as well as animal and plant health –phytosanitary – about imported pests and diseases.

“We’re learning our lessons here: It’s a big culture clash and a titanic struggle with the EU,” Caspers said.

One particular hormone getting a lot of attention continues to be ractopamine, seeing push-back in China and Russia, he said. Ractopamine is a drug used as a feed additive to promote leanness in pigs raised for their meat, as in the additive Paylean, produced by Elanco Animal Health.

Paylean was approved by the U.S. Food and Drug Administration on Dec. 22, 1999, and has been approved in more than 20 other countries. It is banned, however, in countries, including China and Malaysia, which prohibited its use in 2002.

In July 2007 Chinese officials seized U.S.-produced pork for containing ractopamine residues. Further shipments of ractopamine-fed pork were seized in September 2007, though this time they were Canadian in origin.

Additionally, ractopamine has been banned in Taiwan since 2006. Ractopamine caused a considerable stir in Taiwan, when two U.S. shipments including ractopamine-laced pork were rejected by Taiwan’s health authorities while the Taiwan government had been considering lifting the ban on such imports. This resulted in mass protests in the capital of Taipei, by hog farmers insisting that the ban remain in place.

“Agriculture is a global industry and different countries are going to make different policy decisions that may affect trade,” Caspers explained.

“The next big issues will be ethical concerns and biotechnology. The United States needs to participate in the international standard-setting process and engage early on, all while managing on our industry image and defending the SPS agreement.”

As far as how customers of U.S. meat exports view our country, Caspers said opinions vary and there is still a lot of residual negativity from Korea.

“The young generation is more skeptical, while the older generation is more trusting and forgiving,” he offered. “Restaurants in Korea are now touting non-U.S. beef.”

Caspers said that economics will be the driving force behind Korea’s buying decisions. On the other hand, China is becoming more embracing of U.S. beef, with price, taste and brand ranking among the highest principles as it makes buying decisions.

Caspers also discussed trade in Japan and mentioned it is a key beef partner, with $383 million in sales in 2008. “However, we still trail Australia, but are ahead of New Zealand, making up about 6.5 percent of beef consumption in Japan, while Australia is 43.6 percent and domestic consumption is 44.3 percent,” he said.
One element adding to growing U.S. success in Japan is the implementation of the “We Care” campaign, in which restaurants are telling “the story of how beef is raised in the U.S., incorporating stories of producers to make that connection to consumers.”
While beef is making a comeback in countries such as Japan and China, U.S. pork continues to be a key player in Japan as well, claiming the number-one importer position.

“Pork has quite a story to tell; we expect U.S. exports to grow more than 13 percent by 2015,” said Caspers, who added that one out of every three pigs traded is from the U.S., for a total of 50,000 pigs a day. “And 2008 was a record year for pork, up 57 percent in volume to 4.5 billion pounds and 55 percent by value to $4.9 billion.”