December 21, 2007

 

EU toughens rules anew on Brazilian beef imports

 

 

Brazil -- the largest beef player on the international market with exports of 1.9 million tonnes in 2006-- is again subject to strict controls and supervision in its beef shipments with the European Union.

 

The EU's standing committee on the food chain and animal health (SCoFCA) announced it would impose a partial ban on imports from Brazil with effect from 31 January.

 

After that date, only beef raised on enterprises approved by the EU will have access to European markets. Farmers in Europe have long argued importation that has not met their standards of production and traceability.

 

SCoFCA's new ruling is that cattle whose beef is destined for export must have been on the farm of origin for a minimum of 90 days since birth plus a further 40 days before slaughter. If those criteria cannot be met, then there will be an additional 90 days of residency necessary to comply with the new EU ruling.

 

But the rule that is likely to cause huge problems for Brazilian exporters is that all cattle must have been registered on an approved database.

 

Brussels has made it clear that it will list all eligible farms and ranches on its Trade and Agricultural Control Export Systems website and instigate a strict inspection regime. How that is to be implemented remains unclear, but sources in Brussels told The Scotsman it would be "rigorous".

 

Since a major epidemic of foot-and-mouth disease was diagnosed in Brazil in October 2005, local authorities are perceived to have blatantly flouted EU restrictions. More than 60 percent of the 335,000 tonnes of beef exported to the EU in 2006 came from the three provinces where FMD was rife.

 

A delegation from the Republic of Ireland returned from Brazil in May and made the case for an immediate total ban, citing the risk of a major outbreak of FMD in the EU unless exports were curtailed. At first the EU consumer and health commissioner, Markos Kyprianou, dismissed the Irish observations as being of doubtful credibility. However, a recent visit by officials from the Brussels-based Food and Veterinary Office confirmed the Irish allegations.

 

Russia is Brazil's biggest customer, with an inflow of 414,000 tonnes in 2006. Last year the UK imported about 30,000 tonnes of Brazilian beef, but figures for the first nine months of 2007 show a decline of 8 per cent from the same period last year.

 

The impact of the EU ban is difficult to gauge at this early stage. However, there is no great surplus of beef on the world scene. Last year the EU imported 550,000 tonnes of beef from a range of sources and the projected figure for 2008 is in the region of 750,000 tonnes as domestic production winds down as a result of the 2005 reforms of the Common Agricultural Policy and the decoupling of support from production.

 

The initial expectation has to be that ex-farm prices in Europe will rise, with a subsequent impact on the cost to consumers. But they would do well to remember that beef is 30 per cent cheaper in real terms than two decades ago.