NOW that it is clear the United States is playing politics with the issue of resuming a cattle trade with Canada, what is to be done?
The answer seems obvious, even if it does little to get the border open.
Canada must design policy and strategies on the assumption that the Americans, like others, are political traders who open their borders when it is convenient or acceptable to domestic concerns and not when the rules say they should.
For Canadian wheat traders or sugar-containing product exporters, this will not be news. They have battled American protectionism and border politics for years.
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But the Canadian cattle industry has never had that experience. It is integrated, it is North American and it has believed that the U.S. is a free trader, science-based and free of politics.
Well, that is a bit of a stretch. The Canadian and American cattle industries have never really been free traders. They have been continental free traders while keeping tight controls on how much product low-price offshore suppliers can bring into the managed beef system that is North America.
Those have been the rules and Canada’s cattle industry has benefited, increasing exports south while assuming the evidence of American protectionism in other sectors could not happen to it.
Suddenly, the brand is on the other flank.
As much as Canada wants to blame Japanese protectionists, here’s what is happening:
- The United States says it accepts that Canadian beef is safe and Canada’s scientific pursuit of the fallout from one case of bovine spongiform encephalopathy has been thorough. Under trade agreements, the border should open. It has not.
- The U.S. worries that if Canadian cattle move south, Japan’s $800 million (US) beef market will close on Sept. 1, since the American industry does not have the means to trace and segregate cattle in its system. Potential market loss is economics and politics, not science.
- Mexico wants to open its market to Canadian beef but will not until the U.S. guarantees it can continue to ship live cattle north. The U.S. has so far refused.
That sucking noise is the sound is of American credibility on “science-based decision-making” going down the drain.
Given this political reality, Canada should be careful in what it asks for from the U.S.
One Canadian strategy has been to ask that even if a full border opening is not yet in the cards, the border should be opened at least a crack. The theory is that would lead to later pressure for a broader opening.
But what if the border “crack” is to allow import of calves under one year, animals that could not have BSE?
If it became the only American move for a while, the danger is that it could undermine Canada’s feedlot and finishing industry as calves bypassed them to be fattened in the U.S.
The message is clear.
On the beef file, Canada should consider the Americans to be as protectionist as anyone else, when given the chance.
And Canada should be careful about what is asks for when it requests at least a small opening in the wall surrounding Fortress America.
