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).
“CLA is concerned by the findings of this report and the potential impacts a hazard-based precautionary regulation may have on agricultural trade between the U.S. and EU,” said Jay Vroom, president and CEO of CLA. “As one of the main objectives of TTIP is to seek regulatory convergence, differing regulatory frameworks for crop protection products present serious economic and trade impacts. While TTIP works to open up trade between the U.S. and the EU, Regulation 1107/2009 could shut it down.”
In the U.S., the EPA requires extensive testing on all new pesticide active ingredients in order to determine their potential impacts on human health and the environment. These tests include acute and chronic health effects, as well as reproductive and generational effects that are important to consider for endocrine disruption. The testing also addresses sensitive sub-populations including children and pregnant women. In addition, the EPA has developed a two-tiered screening program for all chemicals to identify adverse effects specific to endocrine-disrupting activity – the Endocrine Disruptor Screening Program (EDSP). CLA members actively support science-based regulation and the EDSP, and have committed significant resources to the testing required by the EPA to develop the program.
Research demonstrates that there are thresholds of exposure that do not adversely impact the human endocrine system, which is complex and interacts with both natural and manmade compounds, such as soy, sunlight and stress. It is important that regulators have the ability to discern between substances that do and do not pose concern. Understanding potency and exposure enables regulators to minimize risk while still benefiting from technology. Risk assessment serves as the basis of the regulatory approach taken in the U.S., while the precautionary approach being pursued in the EU seeks to remove beneficial technologies from the market.
DTB Associates LLP is a Washington, D.C.-based firm that was founded in 2000 by internationally recognized experts in agriculture, trade policy and trade law. The firm provides legal, strategic and tactical advice to producers and exporters competing in the global food and fiber market.
The full report is available for download at http://www.croplifeamerica.org/EU-Impact-Assessment. For more information about the EDSP, visit the EPA website: http://www.epa.gov/endo/.