WORLD TRADE IMA/7
19September 1997
ORGANIZATION(97-3785)
International Bovine Meat Agreement
INTERNATIONAL MEAT COUNCIL
Report
1. TheInternational MeatCouncil (IMC) helditsthirdmeeting on19June1997. Mr.AttieSwart
ofSouth Africa waselected asChairman oftheIMCforaone-year term. Theagenda contained in
theconvening airgram WTO/AIR/608 wasadopted.
Functioning oftheAgreement
2. TheChairman recalled that,asafollow-up totheIMC'sreport endorsed byMinisters atthe
Singapore Ministerial Conference inDecember 1996(WT/L/179), anumber ofinformal consultations
onthefuture oftheInternational Bovine Meat Agreement ("the Agreement") hadbeenheld. Inthe
course ofthese consultations, adraftdecision ontermination oftheAgreement attheendof1997had
beentabled.
3. Therepresentative ofCanada stated thatCanada 'scattle andmeatprocessing industry aswell
asgovernment analysts oftheindustry sawlimited utility oftheAgreement andwereusing alternative
sources ofinformation. Henoted thatCanada supported thereduction orelimination oflow-priority
WTO activities toallow moreresources tobedevoted tohigh-priority activities. Inthiscontext, Canada
sawarising needforservicing dispute settlement panels intheareas ofagriculture andSPSmeasures
aswellasconsiderable burdens imposed ontheWTO Secretariat bytheaccession process. Having
examined various alternative arrangements inthecourse oftheinformal consultations, including a
voluntary exchange ofinformation among Parties, noneofwhich hadfound favour withtheCanadian
cattle industry andtradeanalysts, Canada would jointheconsensus toterminate theAgreement. Failing
consensus onthisissue andgiven theindications thatCanada 'smajor trading partners inbeefwere
considering withdrawal, theCanadian government would bedeciding onarecommendation towithdraw
from theAgreement.
4. TherepresentativeofNewZealandendorsedtheviewsexpressedbytherepresentativeofCanada.
NewZealand supported thetermination oftheAgreement onthebasisofadecision taken bytheIMC
priortotheautomatic extension oftheAgreement foranother three-year period. Failing suchdecision,
theNewZealand government would decide onaproposal towithdraw from theAgreement.
5. Therepresentative oftheUnited States stated thattheUnited States supported thetermination
oftheAgreement since many ofitsfunctions were duplicated byseveral other organizations andit
nolonger served itsoriginal purpose. Statistics onmeattrade andprices werepublished onamore
timely basisbyanumber ofother organizations, including theFAO, theOECD aswellasindividual
governments. Trade policy concerns inthebeefsector hadnotbeendiscussed intheIMCforseveral
years, andother fora,suchastheCommittee onAgriculture, theSPSCommittee aswellastheFAO
Intergovernmental Commodity Group onMeatprovided alternatives fordiscussion. Moreover, support
work fortheannual meeting oftheIMCstrained thelimited resources oftheWTO Secretariat. InIMA/7
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theabsence ofaconsensus fortermination, theUnited States would takesteps tojoinothers in
withdrawing from theAgreement.
6. Therepresentative ofAustralia endorsed theviews expressed bytherepresentatives ofCanada,
NewZealand andtheUnited States andstated thatAustralia favoured termination oftheAgreement.
Ifaconsensus toterminate theAgreement could notbereached, Australia would move towards
withdrawal from theAgreement.
7. Therepresentative ofRomania stated thatRomania would joinaconsensus toterminate the
Agreement. InRomania 'sview, theinformation made available intheIMCcould beobtained from
other sources andcertain provisions oftheAgreement were covered bytheWTO Agreement. The
representative ofSwitzerland stated thatSwitzerland supported thetermination oftheAgreement.
Switzerland 'sconsent was,however, subject tocompletion ofdomestic procedures. Therepresentative
urged Parties toadopt thedecision ontermination assoonaspossible inorder tobeabletorespect
theAgreement 'stime-limit withrespect toitsextension (Article VI:3oftheAgreement). Switzerland
would review itsposition ifother Parties weretowithdraw fromtheAgreement. Therepresentative
ofJapan stated thatJapan would joinaconsensus toterminate theAgreement. Therepresentative of
Norway favoured adecision toterminate theAgreement sincetheIMC'sinformation wasalsoavailable
fromother sources. Failing suchdecision, Norway would consider further actions. Therepresentative
ofSouth Africa stated thatSouth Africa wished toseetheAgreement terminated.
8. Therepresentative oftheECstated thattheECcontinued toconsider theAgreement tobe
averyuseful source ofinformation. Intheview oftheEC,thevalidity oftheAgreement should
therefore beextended. TheECwould, however, consider theviews expressed bytheother delegations
andcontinue itsinternal discussion onthematter.
9. TheIMCagreed thattheChairman organize informal consultations before thesummer break
toreview thestateofplayregarding termination oftheAgreement, withaview toreaching afinal
decision inSeptember, account tobetaken oftheurgency ofthismatter toallow timeforthecompletion
ofanynecessary domestic procedures.
Evaluation oftheMeat Market Situation
10. TheIMC tooknoteofthefollowing documents which were prepared bytheSecretariat for
thepurpose ofassisting theIMC'sdiscussion under thisagenda item: "Situation andOutlook inthe
InternationalMeatMarkets"(IMA/W/11),"SummaryTables"(IMA/W/12)and"BovineMeatStatistics"
(IMA/W/13).
11. Therepresentative oftheECstated thattheECbeefmarket wasmoving from thethroes of
theBSEcrisis toastateofconvalescence. TheBSEcrisis hadledtoadecline inconsumption of
1.5kgs.percapita. Bovine meat prices hadplummeted while prices ofother meats hadincreased
significantly. Intervention purchases overthepastyeartotalled approximately 570,000 tonnes ofbeef.
Asbeefsuffered from atarnished image, theEChadadopted a"meat quality policy", elements of
which included theintroduction ofmeatlabelling withrespect tohowanimals werereared, fed,etc.,
andsupport forcampaigns topromote thesaleofquality beef. Therepresentative oftheECexpected
areturn toamore balanced beefmarket intheECbytheyear2000 duetoimproved competitiveness
ofbeef.Beefpriceswereexpectedtodecreasewhilepricesofcompetingmeatswouldincrease,assuming
rising prices forcereals. Insome ECmember States, theexisting price gapwithcattle prices inthe
United States might disappear provided thatbeefproduction intheUnited States declined inthecoming
years. Moreover, ifdemand inAsiaandelsewhere remained strong theECmight beabletoexport
bovine meatwithout export subsidies, asitdidinthepigmeat andpoultry meatsectors. Currently,
roughly onehalfoftotalpigmeat andpoultry meatwereexported without export subsidies, particularlyIMA/7
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tomarkets inSouth EastAsia. Bovine meatimports tookplacemostly under preferential arrangements,
totalling approximately 500,000 to550,000 tonnes.
12. Therepresentative ofJapan stated thatproduction ofbothWagyu anddairy beefcontinued
todecline in1996. Beefconsumption haddeclined sharply inthepastyear, mainly duetoBSE-related
health concerns andanoutbreak offoodpoisoning caused byE.coli. Henoted that,following the
liberalization oftheJapanese import market in1991, consumers hadpreferred cheaper grassfed beef
but,astheretailpriceofhigh-qualitygrainfedbeefhaddecreasedsignificantly,hadincreasinglyswitched
tograinfed beef. With regard topigmeat, therepresentative ofJapan noted thatconsumption had
remained stable inthepastyear, confirming thattheJapanese market wasclose tomaturity. In1996,
Japan hadapplied, asitdidin1995, ahigher gateprice onimports, equivalent totheWTO bound
level.
13. Therepresentative ofSouth Africa informed theIMC that: (i)theredmeat industry was
currently going through arapid process ofderegulation, including thetermination oftheMeat Board
bytheendof1997; (ii)cattle numbers wereexpected topeakin1997/98 duetofavourable weather
expectations; and(iii)beefaswellassheepmeat imports wereexpected toincrease further thisyear.
14. Therepresentative oftheFAOprovided thefollowing information: (i)world meatconsumption
wasforecast toincrease by4½percentin1997, spurred bydynamic economic growth worldwide
andahighpropensity toconsume meatindeveloping countries; (ii)meatconsumption patterns were
expected toshiftfurther towards poultry meat, atrendreinforced thisyearbydeclining prices forpoultry
meat, particularly relative topigmeat; (iii)itwasexpected thatrapid growth would resume inworld
meatproduction, particularly poultry andpigmeat, stimulated bydynamic global demand coupled with
considerably lower prices forfeedgrains; and(iv)world meat trade wasforecast toincrease by
4percentto13.9million tonnes (c.w.e.), withtrade inpoultry meatcontinuing togrow faster than
trade inother meats.
Derestriction ofdocuments
15. TheIMCnoted theGeneral Council 'srequest, when itadopted adecision onthederestriction
ofWTOdocumentsinJuly1996(WT/L/160/Rev.1),thatthePlurilateralAgreementsconsiderappropriate
action. Accordingly, theIMCadopted theDecision on"Derestriction ofDocuments oftheInternational
Bovine Meat Agreement" (IMA/6).
Report totheGeneral Council
16. TheIMCnoted that,according toArticle IV:8oftheWTO Agreement, theIMCisrequired
tosubmit anannual report totheGeneral Council. TheIMCagreed tocontinue thepastpractice that
theChairman prepare areport onhisownresponsibility, withaccount tobetaken ofanyfollow-up
tothismeeting.