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North American Trade in An Era of Increasing …cnas.tamu.edu/Presentations/MooseJaw2004.pdfNorth...
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North American Trade in An Era of Increasing Regulation & Market Disruption Parr Rosson Professor & Director Center for North American Studies Texas A&M University C NAS
Transcript of North American Trade in An Era of Increasing …cnas.tamu.edu/Presentations/MooseJaw2004.pdfNorth...
North American Trade in An Era of
Increasing Regulation & Market
Disruption
Parr Rosson
Professor & Director
Center for North American Studies
Texas A&M University
CNAS
Food Safety & Security
Issues Disrupt Trade & Market
Integration
Bovine Spongiform
Encephalopathy & Avian Influenza
Issues Related to Genetically
Modified Crops & Foods
Bioterrorism Act Implementation
CNAS
Mad Cows & Other
Monsters!!
Bovine Spongiform Encephalopathy
• December 23, 2003 Dairy Cow Tests Positive for BSE
• Mega Markets Closed
– Japan, Mexico, Korea (80%)
• Canada (10%) Reopened 1/22/04
• March 3, 2004: Mexico Opens Market to Deboned Meat from Cattle < 30 months
• Korea & Japan Still Closed
• U.S. Implementing Animal ID System
• U.S. Market Still Closed to Canadian Cattle
US Feeder Cattle Futures, Nov 03-Jan 04
BSE
12/23/03
US Fed Cattle Futures, Nov 03-Jan 04
BSE
12/23/03
U.S. Beef Production & Cattle Inventory
Source: USDA/FAS, www.fas.usda.gov/psd
1980 1984 1988 1992 1996 2000 2004
21.0
22.0
23.0
24.0
25.0
26.0
27.0
28.0 Billion Pounds
90.0
95.0
100.0
105.0
110.0
115.0
120.0 Million Head
Beef Production Cattle Inventory
95.8
23.07
US Beef Demand
Livestock Marketing Information Center & ERS, USDA.
&
&
& & & & & & & &
& & & & & & & & & & & & & & &
!
!
! ! ! ! ! ! ! !
! ! ! ! !
! ! ! ! ! ! !
! !
1980 1985 1990 1995 2000 2004 0
20
40
60
80
100
120 Retail Choice Beef Index
Per Capita Retail Consumption
!
&
Retail Index Base Year 1980=100
Index & Pounds per Person
&
Canadian Exports of Live Cattle and Hogs
to the United States, 1993 - 2003
Source: USDA/FAS
0.8 0.9
1.7
2.8 3.2
4.1 4.1 4.4
5.3 5.7
7.4
1.2 1.0 1.1 1.5 1.4 1.3
1.0 1.0 1.3
1.7
0.5
1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003
0.0
2.0
4.0
6.0
8.0
10.0
Million Head
Hogs Cattle
US Cattle Imports from Mexico
1970 1975 1980 1985 1990 1995 2000 2004F 0
500
1000
1500
2000
1,000 Head 1,653
1,360 F
Annual Avg. 800,000
Head
2004 is CNAS forecast
US Feeder Cattle Futures, Apr-Jun 04
Chicago Mercantile Exchange
US Fed Cattle Futures, Apr-Jun 04
Chicago Mercantile Exchange
Omaha Choice Steer Prices
1980 1985 1990 1995 2000 2004$40
$50
$60
$70
$80
$90
$100$/100 Pounds
Trend
$85.59
$10 Above
Trend
$17 Above
Average
Monthly Omaha Choice Steer Prices
J F M A M J J A S O N D $0
$20
$40
$60
$80
$100
$120
$/100 Pounds
$105.50
$72.24
$91.95
2002
2003
2004
$76.73
$62.49
?
US Boxed Beef Prices, Selected Boneless Cuts
AMS, USDA
$4.95
$1.34 $1.34
$6.50
$3.98
$4.96
$1.49 $1.77
$7.31
$5.37
Ribeye Chuck,
Shoulder Top Inside Round Loin Strip Flank Steak
$0.00
$2.00
$4.00
$6.00
$8.00 June 2003 June 2004
$/Pound
Canadian Cattle Inventory
11.86
12.0
12.71
13.40 13.41 13.36 13.21 13.20 13.61
13.76
13.49
14.66
1993 1995 2000 2004 8
10
12
14
16
Million Head, January 1
USDA, ERS, PSD.
Alberta Direct Sale Steer Prices
Source: Alberta Agriculture, Food and Rural Development, www.agric.gov.ab.ca
$30
$50
$70
$90
$110
CN$/CWT
$106.0
$88.3
$41.5
$36.2
$84.0
$107.0
$115.0
$70.8
$113.0
$77.4 $75.0
Mid-month Average Prices
BSE
Alberta Direct Sale Steer Prices
Source: Alberta Agriculture, Food and Rural Development, www.agric.gov.ab.ca
2001 prices are monthly averages, source CANFAX calculated by LMIC.
$20
$40
$60
$80
$100
$120 CN$/CWT
2001 2002 2003 2004
BSE
2002-04, Weekly Average Prices
$71.10
Canadian Beef Exports to US Market,
Jan-Apr 1989-2004
1989 1995 2000 2004 0
20
40
60
80
100
120
140
Actual Trend
1,000 Tons
Canadian Beef Exports to US Market
31 27
24
1
72
90
101
111
2001 2002 2003 2004 0
20
40
60
80
100
120
140
Boneless Bone In
1,000 Tons (January-April)
Summary/Implications
Strong Demand, Low Domestic Production,
Limited Imports of Canadian Cattle
– Record High U.S. Cattle Prices
Uncertainty About Opening of U.S. Market
to Canadian Cattle
Canadian Herd Size Up 8.7% from 2003
Prices Appear to Be Following Seasonally
Normal Patterns
How Will Canadian Producers Respond?
Jumping Genes!
Frankenfoods!
GMO Crop Acres: World & U.S.
Source: Wall Street Journal, 4/16/04, and NASS and ERS, USDA
11
30
70
100
115
130
145
165
10
29
60
77 69
81 92
102
1996 1997 1998 1999 2000 2001 2002 2003 0
50
100
150
200
Million Acres
US GMO Acres by Crop
Source: NASS and ERS, USDA
5.8
11.9
31
41.3 40.1
50.4
55.5
59.5
2.4
13.1
22.9
26.7
19.9 19.7
26.8
31.5
2.5 3.65.9
8.9 9.510.8 9.9 9.8
1996 1997 1998 1999 2000 2001 2002 2003
0
10
20
30
40
50
60
70
Million Acres
Soybeans Corn Cotton
U.S. GMO Share of Acres by Crop
Source: ERS/USDA, April 2004
#
#
# # # # # #
#
%
%
%
%
%
% %
% %
'
'
' ' '
' ' '
'
$
$
$ $
$
$
$ $ $
&
&
&
&
&
& &
&
&
1995 1996 1997 1998 1999 2000 2001 2002 2003 0
10
20
30
40
50
60
70
80
90
100 Percent
HT Soybeans Bt Corn Bt Cotton Ht Cotton Ht Corn & $ ' %
United Nations Biosafety Protocol
(Cartagena Agreement): Protect Biological
Diversity
87 Members (US Not Signatory)
Prior Notice of Exports to Recipient Countries
Liability Rules to Be Developed-Contamination
US Must Comply, Though Not Member
First International GMO Agreement
Adopted January 2000, Effective September 11,
2003, GMO Rules Implemented March 2004
European Union GMO Rules April 18, 2004
Allows for Informed Consumer Choice
Moratorium on New Varieties Ended
Warning Labels Required for Products Containing More than 0.9% GMO
Distributors Need to Maintain Tracking of Products Containing GMOs
Not Certain if Feeds & Other Products Affected
No Labels for Meat, Milk, Eggs
Greenpeace Opposes New Rules
10 New Countries Enter EU May 2004
Other Major Developments
Brazil Develops New GM Soybean
China Approves Permanent GMO Certificates for Corn, Cotton, Soybeans
Australia & Argentina Rapidly Adopting GMOs
Monsanto Announces It Will Not Continue to Develop Wheat GMOs
France Announces 8 Trial Sites for GMO Crops
Bioterrorism Act 2002 Food & Drug Administration
Registration
– What’s a Farm? a facility in one general physical location devoted to the
growing and harvesting of crops for food and/or the raising of animals for food (including seafood)
– Farms Are Generally Exempt from Registration-But, Some Confusion
Prior Notice
– FDA Prior Notice Rule (Before Arrival): 2 Hrs. if Road, 4 Hrs. if Air or Rail, 8 Hrs. if Water
Current Regulations Include Live Animals
Foreign Facilities—
Register or Exempt?
Register:
– Manufacturing/processing a finished food product
– Packing or holding a food product or food ingredient
Exempt:
– Manufacturing/processing a food ingredient that is subsequently further manufactured/processed outside the U.S.
Full Enforcement Begins August 13, 2004
FDA Contacts
L. Robert Lake – Senior Manager
– (301) 436-2379 or [email protected]
Leslye M. Fraser – Lead
– (301) 436-2378 or [email protected]
HELP DESK
– Phone: 800-216-7331 or 301-575-0156
– E-mail: [email protected]
– Fax: 301-210-0247
Web Address: www.fda.gov
Center for North American Studies
Parr Rosson
Ph: 979-845-3070
E-mail: [email protected]
“Informed Decisions for Global
Change”
C NAS
