U.S. ag exports threatened by EU pesticide regulation
A new report finds that more than 40 percent of U.S. agricultural commodity exports, including soybeans, grains, tree nuts, fruits and groundnuts could be blocked by upcoming changes in the European Union (EU) Plant Protection Regulation. If the EU regulation is implemented as proposed, it could block more than $4 billion of U.S. agricultural exports to the EU, in addition to exports of crop protection active ingredients. Such actions would imperil the Transatlantic Trade and Investment Partnership (TTIP). The report, “Potential Trade Effects on U.S. Agricultural Exports of European Union Regulations on Endocrine Disruptors,” was commissioned by CropLife America (CLA) and authored by Kyd D. Brenner, senior consultant at DTB Associates LLP.
CLA held a briefing on the report at the National Press Club (Holeman Room) in Washington, D.C. In addition to the report author, speakers included John Block, former U.S. Secretary of Agriculture; Gabriele Ludwig, associate director of environmental affairs for the Almond Board of California; Dr. James Murphy, former assistant U.S. Trade Representative; and Jay Vroom, president and CEO of CLA.
EU Regulation 1107/2009 diverges from the U.S. Environmental Protection Agency’s (EPA) regulatory approach, which uses science-based risk assessment procedures for regulating crop protection products. While scientific risk assessment is the internationally accepted practice for regulating crop protection products, the EU increasingly regulates based on hazard identification, without taking into account exposure or risk. This runs counter to the World Trade Organization (WTO) Sanitary and Phytosanitary (SPS) Agreement to which the EU is signatory.
U.S. agricultural exports containing trace amounts of approved crop protection products will be blocked because maximum residue levels (MRLs) for food and feed treated with these crop protection products will default to a near-zero level of 0.01 parts per million (ppm). This arbitrary threshold is a result of the EU regulatory requirement to categorize compounds as endocrine disrupters, which then triggers a market cut-off, or ban.
Exports from the U.S. to the EU have already fallen significantly relative to other exporting countries, in large part due to existing EU SPS barriers to trade. The report estimates, based on MRLs established in the U.S., that at least 24 active crop protection products and 25 different types of agricultural commodities could be impacted by the EU regulation. The largest effects would be felt in exports of tree nuts and fruit ($1.577 billion); soybeans and groundnuts ($1.516 billion); and grains ($0.586 billion).