June 18, 2014 Comments are off Montana Stockgrowers Association
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Inside Trade Agreements – The World Organization for Animal Health (OIE)

Editor’s Note: Part two of a series of articles (Part 1) in which we will look at trade and the organizations that set the standards for these agreements. The next article will focus on the Codex Alimentarius. Provided by the National Cattlemen’s Beef Association for educational purposes. By: Mallory Gaines, NCBA Policy Analyst, Cattle Health

As discussed in the first article in this series, trade is a fundamental part of America’s cattle industry and the NCBA supports free and fair trade based on internationally-accepted, sound science. The framework supporting this principal is the World Trade Organization, which relies on guidelines developed by groups like the OIE.

In 1995, with the establishment of the WTO, the Agreement on the Application of Sanitary and Phytosanitary Measures entered into force. The purpose of the SPS Agreement was to ensure member countries that their consumers were being supplied with food that is safe to eat, but what is considered safe by international standards? The SPS agreement sets out the basic rules for food safety and animal and plant health standards, allowing countries to build upon this foundation to set their own standards. However, the agreement dictates that those standards and regulations must be based on science. This basis on science separates protection from protectionism. The World Organization for Animal Health, known by its French acronym OIE, is one body that sets those scientific standards.

Established in 1924, the OIE started with 28 countries. The U.S. joined in 1976, and in 1994, the OIE was designated by the WTO as the scientific reference body for animal health. Today the OIE has 178 member countries, with one country – one vote. The OIE collects and disseminates information on disease events, harmonizes health standards for trade in animals and animal products, and provides guidance for disease control and eradication. But today, the OIE is expanding with new mandates, and looking at developing guidelines on animal welfare, food production and safety, and helping member countries improve their veterinary services.

The OIE enforces strict reporting obligations for member countries for listed diseases.  For routine diseases TB and blue tongue, annual and six-month reporting is required. For emergency or foreign animal disease the requirements are for immediate reporting, within 24 hours of confirmation. This applies to FMD, vesicular stomatitis, and BSE.

The OIE is made up of four specialist commissions.  NCBA works most closely with the commission which develops the standards and recommendations for the safe trade of animals and animal products. Moreover, this commission oversees the work on animal welfare and food production and food safety.

As a member country, the U.S. participates at various levels, preparing the U.S. position based on science, sending official comments and working within our Region to build consensus. The OIE played a major role in our trade relationship with the first case of BSE in the U.S. in 2003.  Their recognition of the U.S. as “controlled risk” for BSE helped our negotiators to rebuild foreign market share following market closures and protectionist attitudes. In May of 2013, with the work of USDA APHIS, the risk status was upgraded to “negligible risk” which further helped in gaining market share lost in the Pacific Rim, including Japan. And it is based on the standards out of the OIE that we continue to press for greater access to countries like China, Russia and Korea.

At the end of May, NCBA will attend the annual meeting of the OIE as part of the U.S. delegation. The OIE will adopt a chapter to the code of Terrestrial Animal Health and work on other policy issues. The official U.S. delegate to the OIE is Dr. John Clifford, USDA Chief Veterinary Officer, but the delegation often relies on the expertise of industry in crafting their recommendations and comments. It is important for all cattle producers that NCBA ensures the concerns of our members are addressed at the OIE and to ensure that standards considered and passed fit the needs of our industry. This will become all the more important as this body moves on to consider issues like animal welfare, on farm food safety practices and antimicrobial resistance.

June 10, 2014 Comments are off Montana Stockgrowers Association
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Inside Trade Agreements – World Trade Organization (WTO)

Beef Offal Export Values World Trade OrganizationEditor’s Note: Part one of a series of articles in which we will look at trade and the organizations that set the standards for these agreements. The next article will focus on the World Organization for Animal Health (OIE). Provided by National Cattlemen’s Beef Association for educational purposes.

Trade is a fundamental part of America’s cattle industry, and with new pacts on the horizon like the Trans-Pacific Partnership and the Transatlantic Trade Investment and Promotion agreement the beef industry is poised to take advantage of greater opportunities ahead. Ninety-six percent of the world’s population lives outside of United States’ borders, and it is critical to capitalize on these foreign markets to maximize profit margin. Beef demand looks different across the world, and foreign markets drive demand and increase profitability for beef cuts that are less popular here in the states, drivers our cattle industry can capitalize on. In 2013, trade brought home more value to the producer than ever in the past – $307 per head or $6.15 billion total. This premium underlines the value of trade for all segments of our industry. And the major regulator of these opportunities is the World Trade Organization.

The WTO has a long history in international trade. Its formation reaches back to the Treaty of Versailles and the end of World War I, with the establishment of the League of Nations. After World War II, the General Agreement on Tariffs and Trade was formed. And in 1995 with the Uruguay Round of trade negotiations, under the age is of the GATT, the WTO was formally created to discuss and negotiate the further development of trade rules and seek peaceable resolution to trade disputes. With its history in war, the main function of the WTO then as now, is to ensure that trade flows as smoothly, predictably and freely as possible.

To secure these market opportunities, countries work through the WTO. The WTO was built around trade agreements which were negotiated and signed by many of the world’s leading trade nations. These documents provide the legal ground rules for international commerce. They are essentially contracts, binding governments to keep their trade policies within agreed limits. Although negotiated and signed by governments, the goal is to help producers of goods and services, exporters, and importers conduct their business, while allowing governments to meet social, environmental and safety objectives.

Economic development and well-being is dependent upon free trade and as such, the WTO’s overriding purpose is to help trade flow as freely as possible — so long as there are no undesirable side effects. That partly means removing obstacles and ensuring that individuals, companies and governments know what the trade rules are around the world, and giving them confidence and security without fear of sudden policy changes.

Which brings us to the point of why WTO is important and what their role is in international trade. The NCBA does not necessarily work with WTO directly; we work with our government, the U.S. Trade Representative and the governments of other nations affected by decisions at the WTO. But the WTO makes many of their trade decisions based on standards set by other organizations. WTO gives these organizations credence by recognizing the standards they set. These organizations, like the World Organization for Animal Health, known by its French acronym OIE, and Codex Alimentarius, set the precedent that WTO looks at and that the cattle industry can use as a guide for animal health and food safety.

When our membership calls for free and open trade based on internationally recognized science, OIE and Codex provide the science that underlies that notion. And that is where NCBA works. Over the past several years and through the next months, we will be attending meetings and submitting comments and documents to ensure that the standards set on the global level for animal health and welfare and food safety are in line with the most recent science and that these standards work for the U.S. cattle industry.

An example would be a beef trade dispute with a country that refused to accept U.S. beef that was at any time fed a beta-agonist. Codex, has a set maximum residue level, or MRL, for certain beta-agonists in meat based on the scientific evidence presented by a varied committee of nations, experts and researchers. Since this level has been recognized internationally, it would be among the standards used if the U.S. were to take up a case against that country’s action at the WTO. And that is the type of action that preserves our ability to trade openly with other nations.

Of course not all WTO disputes are based on sound science. There are many other barriers to trade that the U.S. beef industry works with. There is protectionism both domestic and abroad. Policies like COOL, that discriminate against our trading partners and threaten retaliatory action against our beef exports to Canada and Mexico, which alone make up one-third of our total beef exports. And as with other trade disputes, the WTO is not the only way to work out our differences. As with our relations with China, Japan, the European Union and others; the decisions on how to move forward involve not only the possibility of enforcement at the WTO, but diplomacy and leadership through the Administration and our ambassadors and attachés. But we will continue to work with all of these groups to ensure we can provide the same great high-quality beef we raise and produce here in the U.S. to our customers across the world.

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