New Ag Secretary Talks Better Beef Trade

Schafer tells industry progress is being made toward opening international markets.

Published on: Feb 11, 2008

Edward Schafer, the new U.S. Secretary of Agriculture, told beef producers international trade opportunities for their products should improve this year.

He made his comments at the National Cattlemen's Beef Association annual convention in Reno, Nev.

Schafer recognized the need to further improve trade to increase income for beef producers and recapture monies lost after the 2003 BSE outbreak.

He also offered praise for USDA's multi-faceted work in the agriculture economy and then suggested it might be too easy for others, perhaps especially for those outside the agency, to overlook governmental accomplishments in reopening international trade for beef.

"When I went back over the Department of Agriculture's effort to win fair access for American beef in markets all over the world it strikes me that really a good deal has been accomplished," Schafer said.

"In May of last year we won the designation as a controlled risk nation," he said. "With that rating in hand we've been able to open markets for American beef that had previously been closed to us. And once those markets are open what we see is that our export sales grow rapidly as consumers respond to the quality of American beef."

"In fact, we expect our exports for 2007 to be up $2.6 billion, and that's up more than 30%," he said. "We still have work to do to get back to where we were in 2003, but the trend is clearly in the right direction."

He noted beef trade reopened with Indonesia, the Philippines, Barbados and Russia this past year.
Schafer also said progress is being made toward agreement on science-based guidelines with Taiwan, South Korea and Japan, which should reopen those markets, too.

These for U.S. beef should be worth $90 per head and more, said economic analysts from Cattle-Fax during that company's annual meeting and outlook seminar the day before Schafer's speech.

Schafer noted also that the U.S. classification by the OIE, which is the World Organization for Animal Health, will continue to be an important trade tool, despite some voices which have called for dropping out of the organization. The OIE is the intergovernmental organization responsible for improving animal health worldwide.

Schafer said, "We all believe the progress we've made in just the past six months shows what a valuable tool our OIE classification is. We worked long and hard to get it, it provides an objective and science-based classification for trade, and we plan to stand by it."

"I want you to know that removing the trade barriers that remain out there remains a top priority of President Bush," Schafer added.

Schafer said he believes the change of administration in South Korea will make a significant difference in reopening that important export market for U.S. beef.

When asked during a press conference about similar prospects for beef trade improvement made by former Ag Secretary Mike Johanns last year Schafer said, "There is a new guy in town."

Food safety a priority

Schafer also said his administration will boost the budget for food and safety inspection this year, hopefully adding to consumer confidence and perhaps speeding some form of long-term resolution for issues such as E. coli contamination and recalls.

Schafer spoke in favor of international free trade. He said free trade has dramatically increased trade with Mexico and Canada, and further negotiations through the Doha round of trade talks will open markets further and increase income for American farmers and ranchers.

Corn prices

Schafer said renewable fuels are clearly important to the current U.S. government. He then acknowledged that means in the near future corn prices will stay higher than beef producers "want them to be."

But he said production of cellulosic ethanol and other biofuels will increase steadily, eventually replacing much of the corn-based ethanol.

"As that technology develops and as we move into non-feed sources to generate our energy needs, it will stop distorting the prices of your feed," he promised.

He also noted there will be no early release of Conservation Reserve Program acres to attempt to lower corn prices this year.