1. regulatory | education | partnership Overcoming North American Trade Hurdles Barry Carpenter

2. 2014 Global Meat Trade Exports in Million Tons 30 25 20 15 10 5 0 Poultry Pork Beef USDA-FAS: 2014 Livestock and Poultry: World Markets and Trade

3. Beef Statistics USDA-FAS: November 2013 Livestock and Poultry: World Markets and Trade

4. Livestock Marketing Information Center, Data Source: USDA-FAS

5. Source: USDA-FAS, CattleFax

7. Pork Statistics Globally, pork is expected to reach near record highs USDA-FAS: November 2013 Livestock and Poultry: World Markets and Trade

8. Livestock Marketing Information Center, Data Source: USDA-FAS

9. Lamb Statistics  Globally Main world exporters are New Zealand and Australia, by a large margin  United States Minimal Exports are down 6% Most exports go to Mexico and Canada  Canada Minimal Top 3 export markets are Thailand, France and US  Mexico Net importer Export mainly to US and Russia Data Source: USDA-FAS

10. Broiler Statistics USDA-FAS: November 2013 Livestock and Poultry: World Markets and Trade

11. Livestock Marketing Information Center, Data Source: USDA-FAS

12. Trade Agreements and Groups  NAFTA Canada, US and Mexico Started January 1, 1994 Worlds largest free trade area  450 Million people  17 Trillion in goods and services

13. Trade Agreements and Groups  US-Canada Regulatory Cooperation Council (RCC) Created February 4, 2011 Working on reducing trade hurdles between US and Canada Joint Action Plan released December 7, 2011

14. North American Trade History

15. Hurdles and Challenges  Overall major hurdles and challenges in all areas Streaming trade processes Eliminating re-inspection at borders Country of Origin Labeling (COOL)

16. Hurdles and Challenges: Policy and Government  Certification and border inspection needs to be streamlined  Common meat nomenclature

17. Hurdles and Challenges: Policy and Government – COOL Timeline 2002 – Made mandatory in Farm Bill 2008 – Amendments to address key problems 2009 – Final rule takes effect 2009 – Mexico and Canada file official complaint with WTO 2011 – Panel finds in favor of Mexico and Canada 2012 – WTO finds US out of compliance 2012 – May 23, 2012 compliance date set 2013 – USDA proposes and finalizes rule with no significant changes

18. Hurdles and Challenges: Policy and Government – COOL

22. regulatory | education | partnership

23. Hurdles and Challenges: Policy and Government – COOL Beef Increased Processing Costs in the US  Establishments running imported cattle Increase $45.50 - $59.00 a head  Establishments running only US beef Increase only $1.50 a head Pork Increased Processing Costs in the US  Establishments running mixed origin hogs Increase $6.90 – $8.50 a head  Establishments running only US hogs Increase only $0.25 a head

24. Hurdles and Challenges: Policy and Government – COOL If US does not comply, September – December 2014 WTO retaliation proceedings continue and retaliation against US is authorized

25. Hurdles and Challenges: Policy and Government – COOL  Possible WTO punishments: US Taxpayer compensation to Mexico and Canada The authorizations of trade sanctions against the US  Mexico and Canada have voiced support in favor of this punishment

26. Hurdles and Challenges: Animal Health  A common protocol for disease outbreaks needs to be developed Recognized zones for disease control Mutual veterinary services Method to ensure both countries are protected from disease  Still allow bilateral trade in disease free zones

27. Hurdles and Challenges: Animal Health  A common protocol for veterinary drug plans needs to be developed Align Maximum Residue Limits and tolerances Develop method to inform each other about newly introduced drugs  While maintaining each countries ability to make decisions on new products

28. Hurdles and Challenges: Meat and Food Safety  Have equivalent meat product inspection system Common approach to food safety Align food safety systems while protecting human health  Open sharing of information Government oversight  HACCP Data  Microbiological  Chemical residue

29. Hurdles and Challenges: Meat and Food Safety  Testing practices and procedures Same food safety laboratory accreditation criteria Same of acceptable testing regulations Reliable evidence of test results  Canada lags the US in terms of rapid pathogen testing methods

30. Hurdles and Challenges: Meat and Food Safety  Mexico is behind US and Canada in food safety and system sophistication January 2014, Mexican government announced that they will provide $50 million to abattoirs and processers

31. Hurdles and Challenges: Cultural

33. Conclusion: Big Picture  Major hurdles facing North American trade: Country of Origin Labeling  Hurting trade in Mexico, Canada and US  Against WTO regulations  Unnecessary as it is not improving food safety of meat products

34. Conclusion: Big Picture Streamlining all processes and regulations  Multiple regulations from each country is confusing and difficult to follow  In some cases, the same test is conducted multiple times by each country, which is unnecessary Eliminating re-inspection  Waste of money by both countries conducting the same inspection  Unnecessary

35. Conclusion

36. regulatory | education | partnership Thank you! Questions?