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IMS Regional Conference Rome, Italy October 2005. “The European Union in the Global Meat Complex”. Philip Seng President and CEO U.S. Meat Export Federation. Global Trends. The next 25 to 50 years. Population Resource management Technology Knowledge Economic integration Conflict
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IMS Regional Conference Rome, Italy October 2005 “The European Union in the Global Meat Complex” Philip Seng President and CEO U.S. Meat Export Federation
The next 25 to 50 years • Population • Resource management • Technology • Knowledge • Economic integration • Conflict • Governance
FAO Meat Consumption Estimates % change from base year +67% +29% +108% +34% +57% +30% +64% +22% +44% +22% Source: FAO
Global Red Meat Consumption Rest of World EU-15 Source: FAO
2005 Key Importers Source: USDA
2005 Key Exporters Source: USDA
2005 EU Meat Balance of Trade Source: USDA
EU-25 Total Cattle: 88.4 million PCC – Beef: 19 kg Self-sufficiency: 98.3% (’05 est) Source: USDA, FAO
Value of EU beef external imports in 2004: US$1.7 billion Source: USDA
EU-25 Total Hogs: 152.3 million (2004) PCC – Pork: 44 kg Self-sufficiency: 106% (’05 est) Source: USDA, FAO
Value of external EU pork exports in 2004: US$3.1 billion Source: USDA
EU Beef Developments • Gradual decline in beef numbers prompted by CAP (Common Agricultural Policy) reform • decouples subsidies from production • Implementation due by 2007 • UK – Over 30 Months restriction to be lifted (170-190k mt in 2006) • Availability of commercially-priced beef from outside the EU, particularly South America • BSE decreased production and consumption in the ’80’s and ’90’s • Accession of new member states will not materially alter the dynamics
EU Pork Developments • EU pork production growth rate has slowed • EU-15 pork up to 18 mmt from 10 mmt in 1970 • Flat growth since 1999 • Common Ag Policy affect? • Spain pork production • Avg increase of 6% annually since ‘70 • 18% average annual export growth ’02-’04
EU-25 Buying Beef From: 196,900 mt increase for S. America Source: Global Trade Atlas
EU-25 Selling Pork To: Source: Global Trade Atlas
Emerging Market Access Issues As tariffs fall, countries find other ways to protect their domestic industries • Questionable sanitary standards • Hormone ban, disease restrictions, zero tolerance • Technical barriers • Burdensome paperwork, slow approvals • Anti-dumping measures • Traditionally used by developed countries • Developing countries starting to use As Tariffs Fall…Other Measures Rise Source: Cato Institute
Number of New SPS Issues Raised Each Year Source: WTO
Specific Trade Concerns by Product Source: WTO, 2000-2001 measures
Threats to Global Meat Trade Animal Health / Food Safety Issues • FMD: 13+ countries affected – multiple species • BSE: 24 countries affected comprising 33% of global exports • Avian Influenza: 17 countries affected comprising 53% of global poultry exports • Animal diseases currently threaten 1/3 of global meat exports with losses valued at $10 billion
Impacts • Canada • Exported 47% of production prior to BSE; dropped to 32% • U.S. • 2003 value of exports was $4.2 billion; decreased by over 80% • Japan • Estimated that the food industry in Japan will lose $5 billion due to bans on U.S. and Canadian beef Source: Cattle-fax; UFJ Institute
Trade Concerns Reported Solved After 10 Years Source: WTO
Summary • Scientific Basis Is Vital • Science Can Quickly Become Political • Consumer Perceptions Are Key / Understanding Culture • It is the Industry’s role to provide the necessary information and knowledge to consumers to convey the validity of globally accepted standards
Thank You For more information: USMEF - Denver (303)623-6328 Or visit USMEF at www.usmef.org