The international agricultural landscape is witnessing a troubling trend toward protectionism.
In past eras, protectionism was enabled through tariffs that blocked trade. World Trade Organization negotiations and bilateral trade agreements have largely eliminated that from the protectionists’ toolbox but, as evidenced by recent events in the U.S., there are other ways to impede trade.
California’s Proposition 12 and proposed changes to “Product of the U.S.A.” labelling will thicken the border between our two countries, making trade more difficult and disrupting the integrated North American market.
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Some costs of these new measures will be carried by Canadian hog farmers and beef producers, who will face price discounts, but they are not alone. At the other end of the supply chain, consumers will pay more at the grocery store, something no politician should want to be associated with, especially during a time of rampant food inflation.
How did we get to this point? There’s a saying about roads paved with good intentions.
The new regulatory measures did not start out as trade barriers or with the intent to punish consumers. Californians who voted for Proposition 12 likely did so because they were convinced by a few activists that modern regulations do not consider the welfare of animals being raised for meat consumption, despite science to the contrary. The result is not improved welfare standards but arbitrary requirements for raising animals.
Proposition 12 is not consistent with the rest of North America, including other U.S. states, Canada and Mexico. This means that if farmers, processors and retailers want to sell in California, they will need to segregate products.
If other states implement their own version of the regulations, as is expected, supply chains will face multiple segregations across the continent rather than a harmonized North American market. Segregating production, processing and retail will reduce consumer choice, increase consumer prices and drive down farmer returns.
Manitoba’s hog farmers join with other pork organizations calling on Canada to respond assertively to California’s Proposition 12. All potential measures to stop the fragmentation of the North American market must be taken, including challenges through the WTO and the United States-Mexico-Canada Agreement.
We have successfully confronted protectionist U.S. regulations in the past. As of 2015, Canada and Mexico had successfully challenged U.S. mandatory country of origin labelling for meat at the WTO, demonstrating that law was discriminatory against Canadian and Mexican hog and cattle farmers.
However, the fight against discriminatory labelling is not over.
Today, a ham can be labelled “Product of the U.S.A.” if the animal it came from was processed in the U.S., even if it was born in Canada. This approach recognizes the consistency between Canadian and American food safety regulations and high standards for raising animals.
But this is about to change. Proposed regulatory amendments would require that meat carrying the label be derived from animals exclusively born, raised and processed in the United States. Manitoba hog farmers have longstanding, mutually beneficial relationships with our customers in Iowa, Minnesota and other states, but these relationships won’t count if the U.S. processors and retailers demand that their suppliers adhere to the terms of the new label.
The Manitoba Pork Council holds that, if this occurs, the new label will be voluntary in name only and the millions of dollars in damage caused by mandatory country of origin labelling will recur.
I am concerned that the revised labelling regulations not only undermine the integrity of international trade but also mislead consumers who may mistakenly believe that imported pork is of lower quality.
The challenges faced by meat exporters, including Manitoba hog farmers, are not isolated incidents, but rather part of a broader trend toward international protectionism in agriculture. Many countries are adopting protectionist policies that prioritize domestic industries at the expense of global trade partnerships.
Canada needs to fight back.
There is a provincial election coming in Manitoba. We call upon all parties to prioritize the preservation of our international agriculture and agri-food markets when setting platform policies.
Federal, provincial and territorial agriculture ministers are meeting in July. The issue of rising protectionism and the thickening of the Canada-U.S. border should be a top agenda item at this meeting.
It is vital that governments work together to dismantle barriers and promote an inclusive agricultural trading system. By doing so, we can ensure a prosperous future for farmers, while providing consumers with the quality products they deserve.
– Cam Dahl is the general manager of the Manitoba Pork Council.
