DENVER – “The U.S. cattle industry is challenged by trade today like never before,” said Dennis McDonald, an R-CALF United Stockgrowers of America member and former representative on the U.S. Senate’s agricultural advisory panel on trade. R-CALF USA, created in 1998 to address trade issues facing the U.S. cattle industry at the time, became a membership cattle-producer organization in 1999.
During R-CALF USA’s annual convention in Denver last week, the organization’s international trade committee convened a panel to address issues related to global trade.
Included on the panel were McDonald, former co-chair of the committee; Susan Keller, North Dakota’s state veterinarian; Athol Economou, a director and treasurer of the Australia Beef Association; and American Sugar Cane League representative Warren Harang.
Giving to get. One of the trade challenges faced today is the historic mentality that a country has to “give access to gain access.”
Keller noted that the recent Japan Import Rule was formulated on that belief. However, she cautioned that such a trade mentality – and specifically how the U.S. has handled trade relative to mad cow disease – sets a dangerous precedent.
She specifically noted the different health and import standards the United States is using for different countries relative to the disease, citing the Japan Import Rule versus the Canada rule.
Developing countries. Another prevalent trade mentality is that the United States will export itself to profitability. The panel agreed that trade enhancing agreements are needed, but noted that so many of the agreements are with developing countries that there is little to be gained by U.S. production agriculture.
Harang, who raises both sugar cane and cattle, said U.S. sugar producers face the same challenges as cattle producers, and that is global trade distortions.
He specifically noted that U.S. sugar producers are asked to compete in the global marketplace with countries that receive government subsidies, enjoy lower production costs, and access to the U.S. market. He noted that the United States can import sugar so cheaply that it costs more than the sugar is worth to package it.
CAFTA. Harang also said the American Sugar Cane League has worked diligently to address some of the global trade distortions and tirelessly to defeat the Central American Free Trade Agreement, even though Congress eventually passed it.
“We were successful,” Harang said. “We lost the battle, but not the war. There has never been a fight like that before in Congress over a trade agreement, and U.S. agriculture was finally heard.”
Harang said if U.S. agricultural producers join together like they did on the Central American Free Trade Agreement fight, there will be many more trade successes in the future.
Economou said the same tension exists between traders and producers in Australia as it does in the United States. He also said the tension has existed for a long time, and essentially the Australian producers are the losers relative to trade.
He specifically noted that the U.S.-Australia Free Trade Agreement was not good for Australian producers; many are extremely disgruntled because the Australia traders traded away many health standards Australian producers worked vigorously to achieve.
Where’s it from? McDonald wrapped up the panel discussion by explaining the challenges that need to be addressed for effectively enhancing trade for U.S. cattle producers.
Of utmost concern is giving U.S. cattle producers the ability to distinguish their products from not only other domestic competitors, but from international imports as well.
In addition, McDonald noted that the captive-supply issue must be addressed, as it is not only a concern within the borders of the United States, but will further expand as free-trade agreements are completed and provide unfettered access to the U.S. marketplace.
McDonald said he was especially concerned about the sanitary and phytosanitary issues. With the United States’ recent relaxation of import standards for countries known to have mad cow disease, it is of great concern the same liberalization mentality could be applied to other diseases.
Furthermore, he said the regionalization occurring relative to disease classification could also cause a huge challenge for cattle producers.
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