Hopes fade for end to EU-US beef dispute

Date: 18/11/1999

By Simon Taylor

EUROPEAN Commission officials are pessimistic about the chances of ending the dispute with Washington over beef after EU veterinary inspectors uncovered problems with American controls designed to ensure that only hormone-free produce is exported to the Union.

Sources say differences between the two sides remain which will have to be settled before the Commission can draw up proposals to give the US better access to Union markets for hormone-free beef in return for an end to American sanctions on European exports.

Officials add that the inspectors will only present their conclusions to EU veterinary officials at a meeting next Tuesday (23 November). This could make it difficult for the Union and the US to achieve their goal of reaching a deal ahead of the next round of global trade talks to be held in Seattle on 30 November.

The Union has been discussing a temporary compensation package with Washington, under which the US would be offered increased access for exports of hormone-free beef in return for an end to the €110-million worth of sanctions which Washington has imposed on EU goods imported into the US.

The US government and the meat industry have previously shown little interest in a compensation package based on better market access for hormone-free beef because the largest American cattle farmers were not involved in this niche market.

But US officials say that this approach has become more attractive because the growing demand for organic meat in the US has increased the volume of non-hormone beef being produced, allowing hormone-free production to benefit from greater economies of scale.

However, both sides have stressed that a deal depends on the US being able to increase trade in hormone-free beef up to the value of the sales lost due to the EU's ban on imports of meat produced using growth-promoting substances.

In May, the Union effectively shut the door on the low volume of hormone-free beef imports from the US after spot checks revealed that 12% of shipments contained residues from banned substances. Since then, the US department of agriculture has drawn up a set of stricter rules to ensure that only hormone-free beef is eligible for export.

Following a World Trade Organisation ruling in July that the EU must provide better scientific justification for its ban, the US was authorised to impose sanctions on Union exports. The EU has said that it will not be able to take a decision on whether to lift the ban until the middle of next year, after a series of new studies of possible health risks related to hormone-treated beef have been completed.

European Commission officials are pessimistic about the chances of ending the dispute with Washington over beef after EU veterinary inspectors uncovered problems with American controls designed to ensure that only hormone-free produce is exported to the European Union.