The prevailing attitude seems to be that in the end, science, common sense, and maybe even trade sanctions would resolve the issue. Soon Europeans would be enjoying American beef.
My American friends, you are living in a dream world.
The trade negotiators could come to an agreement over hormone-implanted beef and remove the physical barriers to its importation into Europe, but that doesn't mean that they can sell it.
Even if trade negotiators can convince individual governments in the European Union (EU) that U.S. beef is safe, they still have to convince the European people. Retailers will not stock what the housewife will not buy.
Confidence At Rock Bottom In Europe, after a succession of food scares (B.S.E. in beef, salmonella in eggs, dioxin in animal feeds, etc.), the consumers are calling the shots on food safety.
And they clearly do not want artificial additives or genetically modified organisms, especially anything they firmly consider to be tampering with hormones.
Americans don't seem to realize that the European public feels most of these food scares have been bungled. The European consumer's confidence in food safety is at rock bottom.
Up to five years ago there was a very strong assumption by consumers that food safety was being looked after. Sure, they were interested in the long-term effect of food on health, but they hardly questioned whether their food was safe. Today consumers are on red alert.
Concerns You, Too How does this affect U.S. pork producers' future? Quite a bit.
Due to problems of pollution, high feed costs, food safety impositions (like traceability protocols for all retail sales of pork), welfare considerations, on-farm medication records, etc., production costs are rising substantially. Several traditional, efficient pig production industries in Europe are finding it difficult to survive. Sow numbers are falling off. And, this looks to get worse, not better.
While the current decline could be offset by other European pork industries that are expanding, like Spain's, opportunities for imports may open up for the U.S., Brazil, Mexico and Western Canada - those with space and economy of scale.
Basic Demands But remember, the European attitude has shifted. You will find it impossible to get pork on our shelves unless five major, farm-based criteria are met:
* Must not be antibiotic-fed;
* Must not put breeding females in gestation crates, but in bedded, yarded groups;
* Must not be weaned under 21 days of age;
* Must be easily traceable to the farm of origin in the event of complaint; and
* Inspection and verification protocols must be in place.
European consumers need to be reassured of food safety. We have to win them back. Safety is now a primary buying motive along with price.
If the U.S. pork industry wants a share of the future EU pork market, you will have to rearrange a sufficient portion of your production to dispel the European consumers' fears.
Opportunities Galore
Sure, it will cost you more. But food is expensive in Europe, so you have some leeway to capture any Euro-premium your processor/exporter may offer you (hopefully).
Large-scale producers in the Netherlands, the U.K. and, more recently, Denmark, cannot make a living even at their high level of expertise - 26-plus pigs sold/sow/year. They are looking for joint ventures in North, Central and South America. A global search is on to produce pork to European standards, but at 30% less cost than they are struggling with now on their own farms.
A 2,000-sow unit I just visited in Mexico processes its own pigs and produces a quality retail item at half our Europrice. They are happy with their own local brand, but the possibility of expansion to 12,000 sows with a strong European export potential (most raised under Euro or Japanese specifications) is tempting.
Niche market? Some niche. Europe and Japan together make up a potential of 40% more than your whole U.S. home market for pork.
And who knows, food safety and pig welfare could be a bone of contention not just between the U.S. pork industry and the EU, but eventually between the U.S. and the rest of the world.
But for now, the European consumer definitely calls the shots over food safety. Be warned.