Ottawa is hailing the Comprehensive Economic and Trade Agreement (CETA) between Canada and the European Union as a tool to create “new and improved market access opportunities” for many industries across the country, including the Alberta beef industry.
But one local producer feels information on the benefits of the agreement to Alberta's beef industry comes across as “propaganda” and he wants to see more discussions between the federal government and producers about a number of issues related to the trade of beef between Canada and Europe - including the EU's ban on hormonal growth promotants in beef - before the agreement is ratified.
“We haven't figured out yet how we're going to deal with genetically modified goods,” said Wilhelm Vohs, who owns and operates Valley of Hope Farms west of Spruce View in Red Deer County. “Right now, I think there's a barrier there. They don't want that.”
Canada and the European Union have agreed to CETA in principle, but a number of steps including the finalization of trade negotiations, technical and legal aspects and translating the agreement for the union's 28 member countries, as well as final ratification of the agreement, will take roughly two years.
Under the agreement, Canadian beef producers will be able to sell up to 50,000 tonnes of beef to the EU market without having to pay a duty.
Currently, the duty-free quota for regular beef exports from Canada to the EU is roughly 3,200 tonnes.
The quota for high-quality beef is 11,500 tonnes, but that quota has duty and technical conditions attached to it.
Producers will also be able to sell nearly 15,000 tonnes of high-quality beef, which currently faces a 20 per cent tariff upon entry into European markets, duty-free.
“CETA represents a significant improvement over the pre-CETA market access of Canadian beef and pork exporters,” said Claude Rochon, a spokeswoman for the federal foreign affairs, trade and development department. “Previously, the EU market was largely closed to Canadian beef and pork. With CETA, the government of Canada‘s action creates new and improved market access opportunities for beef and pork.”
She added the federal government is working “as expeditiously as possible” to carry out the technical work necessary to complete the agreement “so that Canadian workers and business can access the vast benefits as soon as possible.”
Vohs, who felt the sting of the bovine spongiform encephalopathy (BSE), or mad cow, crisis eight years ago when one of his cows was found to have contracted BSE, said by his calculations, the removal of tariffs on beef exports to Europe through CETA will mean little in light of the losses Canadian producers are facing due to Country of Origin Labeling (COOL) rules in the U.S. that cost Canada hundreds of millions of dollars, he added.
“It's helpful, but I don't know if that's huge,” Vohs said.
According to the Canadian Cattlemen Association's website, the COOL rules “requires beef, pork and other meats sold in U.S. retail stores to be labelled with the country where the animal was born; requiring U.S. ranchers and meat packers to handle Canadian cattle separately from U.S. cattle.”
The association states Canadian cattle producers lose roughly $640 million annually under the COOL rules, which were brought into effect in 2008.
Rich Smith, executive director of the Alberta Beef Producers organization said, however, that CETA could be “very significant and very beneficial for our producers” if, in addition to the removal of duties on Canadian beef, a number of “technical barriers” to the export of beef to Europe are addressed.
“If those two things come together in the next few years, then (CETA) will present a very significant opportunity for producers,” said Smith.
Right now, he said, Canada only exports “hundreds of tonnes” of beef to Europe because of such barriers, which include a discrepancy between the protocols used in packing plants in Canada and Europe.
The good news, Smith added, is there is a commitment to deal with those barriers.
He also said if the nearly 65,000-tonne duty-free quotas for Canadian beef and high-quality beef within the agreement are fully used, that would “translate into the order of 500,000 head” and Alberta would supply a large amount of those cows.
“Alberta has 40 per cent of the cows and 70 per cent of the cattle feeding capacity so a substantial number of those cattle would come from Alberta,” he said.
The dollar value for Canadian producers from the agreement, Smith added, could be roughly $600 million.
