On May 17, over 15 years after Japan imposed strict trade restrictions on U.S. beef following the discovery of single U.S. BSE-positive cow, the age restrictions on U.S. beef exports were finally lifted.
This move will allow products derived from cattle of all ages to be eligible for export to Japan and will be implemented immediately. In the past, only cattle less than 30 months of age qualified for Japan’s export requirements. The USDA estimates this expanded access could increase U.S. beef exports to Japan by up to $200 million annually.
The announcement came after Secretary of Agriculture Sonny Perdue met with Japanese government officials in mid-May on the outskirts of the G-20 Agriculture Ministerial Meeting in Niigata, Japan, to discuss the importance of science in trade.
Amending trade terms
Though the 30-month age restriction did not impact most U.S. fed cattle, the move suggests a realignment of trade decisions with sound science. Kent Bacus, senior director of international trade and market access for the National Cattlemen’s Beef Association, affirms the importance of Japan’s science-focused outlook.
“Japan has a strong history of scientific regulation,” Bacus told WLJ, “and a lot of other countries take their cues from Japan.”
In the past, Japan’s strict regulations have been tough on the U.S. beef industry. When a single BSE-positive case was confirmed in the U.S. in 2003, Japan immediately banned all imports of U.S. beef and beef products.
“One animal closed us out of many markets and cost our industry billions of dollars in lost sales and market opportunities,” Bacus said. “We realize what the [BSE] threat means to consumers and we don’t ever want to lose their trust or jeopardize their access.”
Japan slowly began allowing partial access for U.S. beef products in late 2005, starting with cuts and products from cattle less than 20 months of age. This was gradually expanded in 2013 to include cattle less than 30 months of age.
Once Japan eliminated age-based BSE testing on domestic cattle in early 2017, potential for lifting similar age restrictions for global trading partners came into play. When Japan’s Food Safety Commission determined earlier this year that cattle age was not a risk to human health, import requirements revision began.
What this means for producers
U.S. Meat Export Federation President Dan Halstrom said during a media conference call last week that Japan is currently an $850 million export market. This newly expanded market will see an increased opportunity for variety meats such as tripe and tongue, and muscle cuts such as tenderloins and strip loins.
Beef producers will see an impact, Bacus affirmed. Although it is hard to quantify, he said it will be reflected in overall beef consumption and growth in market share. Historically, lifted age restrictions in Japan have seen increases in the beef industry by nearly $0.5 billion.
“This is a tremendous opportunity,” Bacus said. “It’s unsure whether this [lifted restriction] will have the same magnitude as in the past, but it allows us to market more cattle to more consumers around the world, which is something we will always support.”
Bacus said other countries still holding age restrictions such as China, Korea, and Taiwan may look to Japan and follow suit in lifting the restrictions.
Looking into the future
However, both Bacus and Halstrom assert that, though this is a great opportunity, Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) members still have a competitive tariff advantage over the U.S. While the U.S. faces a 38.5 percent tariff into Japan, CPTPP members face a $12 tariff advantage at around 26.5 percent.
Bacus stress the importance of battling tariff barriers, “But non-tariff barriers are just as damaging, if not more so.
“They are a way for governments to restrict access and they do that not by using science, but often by politically motivated restrictions.”
Bacus said this development with Japan is a very positive one and may pave the way for future trade agreements. However, he emphasized the necessity of moving forward with the U.S.-Mexico-Canada Agreement (USMCA) to continue building on momentum.
“If we send a message to the rest of the world that the United States is a leader in trade,” Bacus said, “in setting science-based and market-based rules for trade, in other countries where we already trade with, they will play by our rules.”
In an additional recent Japan development, Canada has also scored expanded market access for cattle older than 30 months of age. This expansion has the potential to increase exports by up to 20 percent, according to a released press release. — Anna Miller, WLJ editor
