South Korea lifts eight-year ban on Canadian beef

EDMONTON – South Korea — the last major Asian market banning Canadian beef since a 2003 mad cow outbreak — has reopened its borders to meat from cattle under 30 months old, the federal government announced Friday.

“This is a great New Year’s gift for the Canadian cattle industry and the Canadian economy,” federal Agriculture Minister Gerry Ritz said in a news conference at a Spruce Grove ranch.

“This morning, the government of South Korea notified us that all certification conditions are in place and that Canadian beef under 30 months of age can be exported immediately from our accredited facilities.”

Beef sales to the Asian country could reach $30 million a year by 2015 under restored access, according to industry estimates.

Before the ban was imposed in 2003, Korea was the fourth-biggest market for Canadian beef, with exports valued at $50 million a year. Korea reopened its market to beef from the U.S. in June 2008.

A number of countries banned Canadian beef at the time of BSE, but most major customers, such as Hong Kong, are accepting it again.

Ritz said allowing boneless meat from cattle under 30 months is the first step of gaining full market access to South Korea, to be followed by boned, offal and other products.

“This is about adding value to the cut-out of the animal. This is putting value into the carcass that’s not there now. Korea is a market that buys certain products that other markets don’t buy so this drives the price up of the animal.”

Friday’s announcement was cheered especially loudly in Alberta, which is Canada’s largest beef-producing province.

Alberta Agriculture Minister Evan Berger spelled out how his province will benefit from the turnaround.

“The South Korean market is the last major Asian market to remove its ban on Canadian beef, so this is exciting news for Alberta producers,” Berger said in a statement.

“In 2002, Alberta exported $42.6 million in beef to South Korea, and it was Canada’s fourth largest beef export market when the market closed in 2003.”

Alberta leads the nation in cattle and calf inventories, with an estimated 4.95 million head as of Jan. 1, 2011, or nearly 40 per cent of the national total. Nearly three-quarters of Canadian beef processing occurs in Alberta.

Berger, ranchers and beef processors also thanked the federal government for its work on the file.

“The cattle industry is really beginning to get its economic legs under it,” said Travis Toews, president of the Canadian Cattlemen’s Association.

“This market access opening into Korea will just further strengthen our economic prospects into the future.”

Toews said the industry has finally found its feet after being decimated during the BSE crisis. The industry has shrunk since 2003, but has regained close to 90 per cent of market access lost and prices have rebounded at or beyond 2003 levels, he said.

“We witnessed fed cattle prices being cut well in excess of half of their full value and since then the industry has regained that market access.”

Ottawa announced in 2009 it would take South Korea’s ban of Canadian beef to the World Trade Organization. It suspended its challenge last year after South Korea said it would resume trade by the end of 2011.

“The road to today’s good news for Canada’s beef exporters has been a long one to say the least,” said Federal International Trade Minister Ed Fast.

“We aggressively fought for our beef producers at WTO and we were always confident of our case and our efforts paid off.”

Brian Nilsson, co-CEO of XL Foods Inc., applauded the reopened border but said Canada must now move forward with a free-trade agreement with South Korea, similar to one signed in 2011 between the United States and South Korea.

“We need this so we are not left with a disadvantage in both the pork and beef industry to our U.S. competitors,” Nilsson said. “Without it the U.S. industry will continue to gain as their tariffs decrease and our tariffs remain the same.”

Fast said he is meeting with his Korean counterpart next week at the World Economic Forum to discuss the nations’ trading relationship.

Source: Edmonton Journal

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