Main policy areas
- Domestic support to livestock industries remains relatively limited
in both developed and developing countries;
- In some developed countries, emergency payments to grain producers
in the context of low prices and to livestock producers in the wake
of localised natural disasters have served to support the meat industries;
- Price support schemes provide significant support to the livestock
sectors (beef and pork) in Japan and the Rep. of Korea; their respective
PSEs for beef (OECD, 2000) are 32 percent and 68 percent, respectively,
while those for pork are 58 percent and 47 percent.
- Any reduction in the de minimis provision (10 percent
of the base agricultural production value for developing countries)
is unlikely to have much impact on livestock industries since developing
countries provide very limited support to these industries (most support
classified as green box).
- Expenditures on research/veterinary and other livestock service industries
are not production and trade distorting, hence not subject to reduction.
- The EU proposal to allow direct subsidies related to animal welfare
costs to be included under Green box provisions could lead to higher
overall subsidies to the EU. Since third-country exporters would not
be required to adhere to EU standards, this proposal appears not to
be directly trade-distorting
- Applies only to the EU and other European countries providing direct
income support to beef and sheepmeat producers (decoupled, production-limiting
payments). This support replaced market distorting government stockholding
policies (for beef); however, the overall policy impact is to keep producers
on farms, while encouraging extensive agriculture.
Minimum access quotas: TRQs
- TRQs are applied by many countries, particularly for beef.
The number of TRQs for meat products is estimated at 249, second
only to fruits and vegetables.
- Out-of quota duties tend to be prohibitively high, ranging from double
the import duty (Poland) to over 100 percent (EU). Average out-of quota
duties for meat are estimated by the OECD at 89 percent.
- Quotas assigned to specific countries or country groupings (i.e.
ACP countries) tend to lock out new exporting countries.
- The simple average fill rate for meat products ranges around 60 percent
in the 1995-97 period. This fill rate has increased since that time.
Poultry has the highest fill rate among meat products with a four-year
average (at 88 percent) that is greater than the average for all products
(78 percent). The fill rate for pig meat is the lowest among the meat
products (70 percent) while that of beef is the most variable. The lowest
fill rates were observed for Hungary and Poland.
- Administration of TRQs (beef in the Rep. of Korea and pork and poultry
in the Philippines) has occasionally given rise to disputes; however,
none has been referred to the WTO.
- In some cases, such as the United States, scope for increased trade
(particularly during herd rebuilding) could result from an expansion
of the quota. In addition, market access for meat products in the EU
remains constrained by quotas as well as preferential access.
- In general, any moves to expand quota levels while reducing both
in- and out-of-quota duties would facilitate meat trade.
- Bound tariffs remain high for meat products, particularly in developing
countries where bound tariffs can exceed 100 percent. Within the meat
products, the average tariff for beef is the highest while that for
sheep meat is the lowest.
- In-quota tariffs are considerably lower than out-of-quota rates and
average tariffs. But, with an average of about 20 percent, in-quota
tariffs remain a constraint to trade. In addition to being very high
in certain countries (EU beef/sheep meat, Japan pork, Mexico poultry),
these tariffs contain substantial tariff peaks. For example, tariff
rates on beef can range up to 169 percent in the EU, while Japan can
import a tariff of 395 percent on pigmeat.
- Meanwhile over-quota tariffs in many developed countries are prohibitively
high (see above).
- Tariff escalation appears to be a problem for meat products, particularly
in meat-exporting developed countries, for example, the EU.
Special (and regular) agricultural safeguards
- Several countries have reserved the right to impose SSG provisions
for meat products. In Japan, in 2001, the safeguard for pigmeat was
triggered for the 4th time.
- While the safeguards are trade distorting, they protect countries
from import surges. In many cases, however, developing countries put
in place bound tariffs (or ceilings) for meat imports in which case
they dont have access to the SSG. In most cases bound tariffs
are high enough to make the SSG unnecessary.
- Increasing recourse to countervailing duties (S. Africa), and anti-dumping
(Mexico and Argentina) actions have been reported over the past few
years. The extensive procedural requirements and conditions for using
these measures make it difficult for developing countries to utilise
- Direct subsidies (particularly for beef) create distortions in livestock
and meat markets. In 2000, the WTO quantity ceiling on subsidised meat
exports totalled 2.3 million tons, or 14 percent of world trade. In
the case of beef, subsidised volume limits totalled 1.2 million, or
19 percent of global beef trade.
- Export subsidy ceiling have been binding only for EU beef (in most
years) and Hungary.
- Indirect subsidies (through increased domestic support for feed inputs)
benefit livestock industries in developed countries through lower input
- Intensively used by the US, particularly to move meat products to
Mexico and the Rep. of Korea.
State trading enterprises
- Not an issue for livestock trade.
Export restrictions and prohibitions
- Not a serious issue for livestock trade, though measures have been
applied recently in cases of animal disease outbreaks.
- Not an issue for livestock trade except for the adverse impact that
subsidized meat exports have on livestock industries in developing countries.
- SPS/TBT measures are expected to have a large impact on growth in
meat exports, particularly from developing countries.
- Animal disease outbreaks have led countries to impose import bans
and stricter sanitary requirements as well as other technical barriers,
such as requirements on labelling and animal traceability schemes. Many
of these food safety policy measures and regulations focused on ensuring
food quality will persist and escalate in complexity. This raises the
cost of exporting, particularly from developing countries.
- The issue of food safety, including the use of the precautionary
principle, should be examined within the context of the SPS and
TBT agreements, ensuring an adequate balance between food safety and