CETA Comes Into Effect This Week

The Comprehensive Economic and Trade Agreement (CETA) between Canada and the European Union will come into effect on September 21

by Canadian Cattlemen’s Association (CCA)

As of that date, European beef will be duty free in the Canadian market and new duty-free quotas will be available for Canadian beef entering the EU market.

For the first year of CETA, the initial duty-free quota quantities for Canadian beef are 9,300 tonnes of fresh beef and 2,500 tonnes of frozen beef. But since the CETA is being implemented on September 21, these quantities will be pro-rated down. The quantities available for the final 102 days of 2017 should be 2,599 tonnes of fresh and 699 tonnes of frozen.

Beginning January 1, 2018, the EU will open the second quota year of CETA and the quantities for 2018 will be increased to 14,440 tonnes of fresh and 5,000 tonnes of frozen. The quantities will continue to increase annually until 2022 when they reach the full amount of 35,000 tonnes fresh and 15,000 tonnes frozen per year.

“The bottom line is that producers need to be taking steps now to have EU-eligible cattle when packers are looking for them”

 

The Canadian Cattlemen’s Association (CCA) states that for Canadian beef to be eligible, cattle to be used for EU beef exports must be enrolled in the Canadian Program for Certifying Freedom from Growth Enhancing Products which is the Canadian Food Inspection Agency (CFIA) supervised program for the EU. The CCA has prepared videos to help cow-calf producers and cattle feeders better understand the requirements of producing EU-eligible cattle. The videos are on the CCA website at www.cattle.ca/eu along with a list of CFIA approved veterinarians that can work with producers to enroll them in the program. Additional information will be added to the site in the next several weeks including examples of the required records.

The CCA is concerned that to date very few producers are enrolling their cattle in the EU program and believe that most are taking a wait and see approach to whether the access to the EU market will be genuine and whether the prices for EU-eligible cattle will justify the expense of raising them.

Of course, many will have heard that there are technical issues related to packer practices remaining to be resolved. That is true, and until they are resolved, it is unlikely that either of the larger packers, Cargill or JBS, will be buying EU-eligible cattle.
However, it is CCA’s hope they can achieve resolution of these issues in about a two-year timeframe. If they are indeed successful on that timeline, and Cargill and JBS start wanting to procure EU-eligible Canadian cattle by late 2019 / early 2020, there is a legitimate question as to whether there be sufficient numbers of cattle to supply their demand.

Although later enrollment is possible in some circumstances, typically cattle are enrolled in the program from birth. Producers who enroll their operations in the program this fall will be calving EU-eligible cattle in winter/spring 2018. Those cattle, raised without growth promotants, will take longer to raise and so would not be market ready until late 2019 or early 2020. This anticipated timeframe coincides with the period in which CCA believes the conditions could be established to encourage the larger Canadian packers to enter the market.

In the meantime, smaller regional packers are exploring the EU market potential and may be more easily able to adjust their practices to access the EU. If they determine that the value of the EU market justifies the effort, it is reasonable to expect they will be looking to procure EU-eligible cattle well before the larger packers.

In any event, the bottom line is that producers need to be taking steps now to have EU-eligible cattle when packers are looking for them.

Producers are encouraged to watch the CCA videos to better understand the EU requirements and then contact CFIA or a CFIA approved veterinarian from industry. Although there are not enough approved vets across the country at present to oversee all the cattle that need to be in the program, the CCA is working with the Government of Canada to secure the required resources to train and approve more industry vets.

Interested producers are urged to contact a CFIA approved vet listed on the CCA website or their closest CFIA office in advance of calving season to register an interest in getting enrolled. In some areas, local CFIA officials may not yet be aware of the requirements of the EU program. If you encounter this, please encourage them to request training from CFIA headquarters and you may also wish to notify the CCA. Producers will ultimately need to identify a CFIA approved vet in their area and ideally their own vet will become CFIA approved as this will reduce the costs of the program by potentially permitting the required vet visit to be combined with other veterinary activities.