International trade in commodities derived from animals: A more rational approach?

USAID Meeting 17 May 2007 International trade in commodities derived from animals: A more rational approach? Gavin Thomson, TAD Scientific, Pretoria, South Africa

Outline of the presentation: An evolving saga: Safety of internationally traded animal commodities • freedom of countries, zones, and compartments from agents that cause ‘transboundary animal diseases’ (TADs) is the over-riding principle associated with safety of trade in animals & animal products • “commodity-based trade” where other risk mitigation measures ensure safety • poor recognition of processing of animal products as a risk management measure • the conflicts/synergies between human food safety standards and control of animal diseases

Outline of the presentation (cont.): • Urgent requirement for commodity-specific standards for international trade in animal products • The problem of reliable auditing & certification • Relevance to wildlife/ bio-diversity conservation

Livestock production in Africa • Production is growing at an annual rate of 4.8% for meat and 6.3% for milk • Notwithstanding the growth in production of these commodities, Africa accounts for less than 5% of total world production & 2% of trade in these commodities • In respect of livestock commodities, the African continent imports US$ 2.2 billion more annually than it exports & this deficit is increasing

Livestock production in Africa (cont) Conclusion: Trade in livestock commodities is currently far below what is required to support the rural development required in s-SA

Why is this so? Reasons are many & complex but a major reason is trade barriers These may be either: • Tariff barriers - customs duty or tax imposed on the value of an imported commodity, increasing its price in the internal market • Non-tariff barriers - include import quotas, embargoes and standards

Standards Two primary issues in relation to livestock commodities: Safety of animals or animal products that are incorporated into human food Spread of dangerous animal diseases (TADs) through trade

Risk & trade in livestock commodities • The issue for importing countries involved in international trade is the risk of importation of dangerous human or animal pathogens • Demands for zero risk are now recognized as unrealistic so the issue is: • “maximum acceptable risk” associated with importation or; • in WTO language, the “appropriate level of protection” [ALOP]

Food safety • International standards contained in the Codex Alimentarius (WHO/FAO joint responsibility) • Codex Alimentarius standards are commodity specific • In addition, many ‘private standards’ applicable to food safety including ISO 22000 (food supply management systems)

Animal diseases & the Sanitary & Phyto-sanitary (SPS) Agreement • The OIE (World Organisation for Animal Health) is recognised through the SPS Agreement as the ISSB for international measures relating to animal diseases and trade • OIE “rules” contained in the Terrestrial Animal Health Code (Code) • Unfortunately, these are not well developed for commodities other than live animals – institutional complexities • Standards are disease-specific

Basic approach of the Code Two ways in which safety of traded commodities is assured: • Prove freedom of the country, zone or compartment of origin as being free from important TADs • Prove that the commodity in question poses no more than “appropriate risk” for the importer (accommodates the commodity-based approach)

Accreditation • Accreditation system provided by OIE for countries & zones (compartments?) for only 4 diseases (FMD, CBPP, rinderpest & BSE) • For others only recommendations provided: intended to be used as the basis for reaching bilateral agreement • However, “freedom” from disease is no guarantee of safe trade (FMD in UK 2001)

Compartmentalization: A new alternative? • Concept adopted by OIE but as yet standards unclear Basis: • Safety based on integrated bio-security management for production chains • Establishments within a production chain do not necessarily have to be in the same general locality • Potential for helping developing countries

Compartmentalization Country Y Abattoir & meat processing plant Feed production Feed-lot Ass. sup. Compartmentalized, i.e. bio-secure beef production chain

Problems with compartmentalisation • There is confusion as to how this system will work – no standards yet exist in the Code • Basically compartments still have to prove freedom from a range of infections on an ongoing basis for export • Arguably no more than part of the solution

What about commodity-based trade? • A system for ensuring that exported livestock commodities do not pose more than appropriate risk [ALOP] for spreading human or animal diseases • For some commodities this can be irrespective of whether dangerous infections occur in the area of production & processing or not • It is dependent on identifying the hazards posed by specific commodities and developing ways to ameliorate those risks • Risk mitigation can take many forms and, ideally, incorporates a matrix of risk reduction mechanisms

The idea is that an array of alternatives can be used individually or in combination to ensure that the production and processing of a particular commodity are managed so that identified hazards are reduced to acceptable risk levels. This can include use of disease-free zones, compartments and/or commodity processing, i.e. any combination of appropriate measures to reduce the risk associated with a specific commodity to acceptable levels

How can this be achieved? • Some commodities are inherently safe, e.g. milk & milk products do not transmit BSE & pure beef presents acceptably low risk of transmitting BSE, CBPP, FMD, RVF etc • Processing of commodities can decisively reduce the possibility of their containing TAD-causing agents For trade in such products, why should the overriding concern be freedom (country, zone or compartment) from relevant TADs?

The commodity approach presents advantages for developing countries Processing of livestock commodities offers possibility of ensuring biologically safe products for export, beneficiation and associated employment creation near the site of production

How can commodity-based trade be implemented? HACCP (hazard analysis, critical control points) provides a mechanism that could be applied to this approach but so far this has been restricted to application in human food safety • However, there are two critical issues that need to be attended to: • Commodity standards – responsibility of OIE but pace is too slow! • Regular auditing & credible certification – DCs especially need to address this issue seriously

The problem of certification • Needs to be looked at in a fresh light • Arguably, particularly in DCs, certification by the veterinary administration (competent authority) alone is inadequate, i.e. not credible to importers • Clearly the veterinary administration has an important role but some additional expertise & independence needs to be introduced (contentious issue) • Particular problem in relation to commodity processing – certification of industrial processes

Problem for zonation in southern Africa Creation of a patchwork of TFCA will make export systems based on zoning difficult

Relevance of CBT to conservation/preservation of bio-diversity • Potentially enables integration of livestock production & wildlife conservation • Possibly enables sustainable utilization of wildlife resources • Very difficult presently! • New TFCAs will require more opportunities for livelihood generation than will be possible from tourism alone

Using the commodity approach there is no technical reason why beef or venison from sub-Saharan Africa, for example, could not be exported safely to any market in the world! This could provide an incentive for direct foreign investment in livestock production systems & enable greater flexibility in land-use options Similar approaches could be developed for other animal commodities, e.g. dairy products Ensuring human food safety will be the paramount requirement

International trade in commodities derived from animals: A more rational approach?