November 7, 2016

EU signs FTA with 3rd-largest pork exporter Canada

A much-delayed free trade agreement between the EU and Canada has finally been signed.

The signing of the Comprehensive Economic and Trade Agreement (CETA) was a result of one-week intensive negotiation between Canada and the 28-nation bloc, AHDB Pork reported.

Days earlier, the deal looked headed for trouble after the French-speaking Belgian region of Wallonia rejected the deal, leaving Belgium unable to ratify it. However, following intense negotiations, an addendum to the deal addressed regional concerns. "This allowed the deal to be signed on Sunday (Oct. 30) by Canadian Prime Minster Justin Trudeau and top EU officials", the pork division of the UK Agriculture & Horticulture Development Board said.

It said the revised deal still needs to be approved by the EU parliament, 28 EU member states and by Canada, and "subject to this, the agreement should enter into force next year".

Canada is the third-largest exporter of pork in the world after the EU and the US, but shipments to the EU have been negligible in recent years. Under CETA, pork has been classified as a sensitive product. AHDB Pork said that while a zero duty will apply to Canadian pork exported to the EU, it will be limited by tariff rate quotas (TRQs) to around 67,000 tonnes (product weight). This will be phased in over six years, with the existing TRQ of 4,625 tonnes rising to around 15,000 tonnes in the first year.

AHDB Pork said some technical barriers may need to be addressed before large-scale shipments can begin, though. "The eventual Canadian TRQ equates to just 0.4% of total EU consumption of pork but, in reality, Canadian exporters will target cuts that offer the best returns, especially hams, so the impact on the EU market could be greater".