U.S.
imports and exports of livestock and meat products
are worth several billion dollars each year. This
trade has been noticeably affected by disease-related
issues in the last few years. ERS recently released
a data
set
that provides greater detail on U.S. livestock
and meat trade. This data set contains monthly
and annual data for the past 1-2 years for imports
and exports of live cattle and hogs, beef and
veal, lamb and mutton, pork, broiler meat, turkey
meat, and shell eggs, as well as historical data
on trade in these products. Breakdowns by major
trading countries are included. It also includes
details on product categories for traded livestock
and meat products well beyond the aggregate measures
often reported. These details are used to illustrate
perhaps the best-known case of disrupted trade
in U.S. meat and livestock, that of bovine spongiform
encephalopathy (BSE), over the past 3 years.
BSE Discovery Leads to
Trade Bans and Precipitous Fall in U.S. Beef Exports
By the time a dairy cow in Washington
State (imported from Canada) was found to have
BSE in late December 2003, U.S. beef exports had
risen steadily for more than two decades, reaching
2.5 billion pounds in 2003, or roughly 9 percent
of U.S. domestic beef production. Four countries—Japan,
Mexico, South Korea, and Canada—accounted
for more than 90 percent of U.S. beef export volume
through 2003. Discovery of BSE led to bans on
U.S. beef from nearly all U.S. trading partners.
Canada and Mexico quickly resumed their purchases
after the BSE case, but Japan and South Korea
were much slower to reopen their markets. As a
result, U.S. beef exports fell by over 80 percent
in 2004 and still remain well below their earlier
levels.
Japan and South Korea have both
agreed to resume importing U.S. beef but with
certain restrictions on which products may enter.
Japan currently accepts beef only from animals
under 21 months of age and prohibits “specified
risk materials” (SRMs, or parts such as
the brain and spinal cord, which are known to
contain the BSE infective agent). South Korea
also prohibits SRMs but accepts beef from animals
up to 30 months of age. However, South Korea indicated
it would accept only boneless products, and the
first three U.S. beef shipments there were rejected
for containing bone fragments. Bone-in products
were an important share of the Korean market before
2003 and were growing in absolute terms.
BSE Changes the Structure of U.S.-Canada
Trade
The discovery of a BSE case
in Canada in May 2003 also significantly changed
U.S. cattle and beef trade with that country.
Before 2003, Canada’s cattle exports amounted
to 25-40 percent of its domestic total slaughter,
and it exported over 40 percent of its beef production,
with both cattle and beef exports going primarily
to the United States. The U.S. border reopened
to Canadian beef in September 2003, but Canadian
cattle were not allowed in until July 2005, leading
to rapid growth in the Canadian cattle inventory
during this interim. When the border reopened,
imports of Canadian cattle began to displace imports
of Canadian beef.
Currently, the U.S. allows imports
only of animals younger than 30 months destined
for immediate slaughter or for feedlots and then
slaughter. But before May 2003, cows and bulls
for slaughter (primarily cull animals from the
breeding herd) were also an important class of
imports. USDA is now considering a rule change
to allow imports of older animals, although another
Canadian BSE case involving a cow born well after
Canada’s 1997 feed ban had earlier caused
USDA to withdraw the proposed rule temporarily
while it reviewed its risk assessments.
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