The CCA Foreign Trade Committee Meeting was held virtually on August 5, 2020 during the CCA Semi-Annual Meeting.
Numerous trade updates were presented, starting with the United States and NAFTA. Canada passed the Bill through our legislative processes through a cross party effort in a somewhat hurried manner as COVID-19 entered into Canada in March. This enabled CUSMA to enter into force on July 1, 2020. The leadership of the national cattle organizations of CCA, NCBA and CNOG all met via video conference on July 1, 2020 as part of a regular tri-lateral meeting.
Importantly, Mandatory Country of Origin Labelling (mCOOL) was kept out of the new NAFTA, however, mCOOL supporters continue their efforts to reinstate the discriminatory market effects in one form or another. The CCA continues to work with allies on this issue.
Throughout COVID-19, the Canada-US border remained open to essential business travel. While at the start of the new border rules there was some confusion, the border for the most part continued operating without significant challenges.
The Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) is a trade agreement between Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, and Vietnam. CPTPP came into effect amongst Canada, Japan, Australia, New Zealand, Singapore and Mexico on December 30, 2018. Vietnam became the seventh to implement on January 14, 2019. For the remaining signatories; Chile, Malaysia, Peru and Brunei ratification is not anticipated within a short timeframe. The CPTPP will enter into force 60 days after their ratification. The CCA encourages the further expansion of the CPTPP subject to review of specific country barriers and potential for beef trade.
January 2020 marked the five-year anniversary of the Canada-Korea Free Trade Agreement and the sixth of fifteen annual tariff reductions. In 2019, beef exports to South Korea at $42.8 million were up 66% from 2014 ($25.8 million). Impressive growth, however, a number of challenges remain with exporting to the South Korean market.
The Canada-China relationship continues to be tense with the continuation of Meng Wanzhou making her way through the Canadian judicial system and with China holding the two Michaels. In June, China requested increased commitments from agri-food exporters around the world that their products are free of COVID-19. This request came from Chinese custom authorities following a secondary COVID-19 outbreak within China. Food researchers globally have maintained that the risk of COVID-19 spread on food is extremely low. Alongside this request for commitment letters, China also temporarily suspended shipments from Cargill’s High River plant in Alberta. Cargill High River is amongst numerous plants around the world that has been put on the temporary suspension list. Other plants were from Brazil, Argentina, Germany, the U.K., Denmark, the Netherlands, Italy and the US. In 2019, the export licences of Canadian genetic companies to export Canadian livestock genetics to China were not renewed. China has recently undertaken virtual audits with Canada with the facilities, however the results of the audits have yet to be finalized.
Canadian beef exports to Europe were unique throughout COVID-19 as they were able to grow by 25 per cent in value (YTD May 2020) over 2019. CCA is working on a number of proposals in partnership with the CFIA aimed at facilitating the eligibility of Canadian cattle for export to the EU, a key limiting factor to increasing exports to Europe.
This spring, the EU Farm to Fork Strategy was unveiled, under the umbrella of the European Green Deal. It aims at creating a more ‘robust, secure, and sustainable food system’ and identifies way to support sustainable food production and consumption in both the EU, but also abroad. It includes 2030 targets such as a mandatory front-of-pack labelling, origin for certain products and targets to cut the use of pesticides, fertilizers, antimicrobials among others. There is significant concern that this green deal could result in barriers to trade.
The UK has decided to officially leave the EU and are currently operating under the EU-UK Withdrawal Agreement which set out how the UK would continue to be covered by EU-third country trade agreements until December 31, 2020. The UK and the EU are currently undertaking negotiations to establish their future trading relationship following the conclusion of this withdrawal agreement by end of year. Until the end of 2020, Canada and the UK will trade under the umbrella of CETA, however the future of the Canada-UK trade relationship is largely unknown. There is the potential to reach an interim agreement that would be largely based off of CETA that could come into force on January 1, 2021 and operate until Canada and the UK have the resources to fully undertake a unique bilateral agreement, although time is running short to achieve this prior to the deadline of January 1, 2021.
The Canadian Beef Breeds Council provided an update on the impacts the seedstock sector experienced due to COVID-19. Fawn Jackson and Michael Latimer updated the committee on the staff directive given at the annual meeting on attaining further detail on a project to assess the technical access that Canadian genetics have in international markets in comparison to other international competitors.