The estimated value of developing country agro-food border rejections is $1.8 billion, 74 percent of which is accounted for by middle-income countries. The estimated value of low-income country agricultural and food product trade rejected at the importing country border is $275 million, representing just less than one percent of the agricultural and food exports of these countries. The product composition of the estimated ‘rejected exports’ of developing country is broadly consistent with the data presented earlier on EU and US rejections. For middle-income countries, the dominant products are fish and fishery products and fruit and vegetable and products, followed by livestock products. For low-income countries, fish and fishery products are the dominant category accounting for more than half of the total estimated ‘rejections’.

Until quite recently border rejections due to food safety or related technical issues can be said to have had only a modest impact on overall trade in agricultural and food products, including that of developing countries. We estimate that approximately one percent of this trade was directly affected in 2000-01. Further, only a small proportion of rejected consignments is actually destroyed at the point of import, whilst some (perhaps significant) proportion of the product is re-shipped, re-conditioned or otherwise managed for sale whether in the domestic market of the exporter or some other international market. Indeed, the proportion of agro-food trade which encounters official rejections is, for most food categories, probably substantially lower than the proportion of sales which are subjected to price discounts by private buyers because of issues related to quality defects, lack of timeliness and poor presentation. Further, the products with the highest estimated proportion of rejections are also among those for which there have been proportionally, the highest rates of growth in international agricultural trade.<sup>28</sup> The foregoing discussion suggests that, while border rejections are undoubtedly a major irritant to exporters, in most cases they do not act as a major impediment to trade. That having been said, they are undoubtedly costly, both in terms of the value of lost product and any adverse effects on the reputation of the supplier and perhaps the country of origin as a whole. For some importing countries, the occurrence of repeated violations of food safety and other standards may result in particular suppliers or the entire country being listed for automatic detention. Subsequent shipments are detained, inspected and tested at the expense of the exporter or importer until a record of compliance has been (re)established. It can take a considerable period of time for this to be achieved and the costs associated with detentions can be considerable.(See Lamb _et al_ 2004). Further, during this period exporters may lose customers, which are unwilling to incur the potential costs and delays associated with enhanced border formalities.

In addition, there are some indications, at least from recent patterns for certain high-income countries, that increased attention is being given to border inspections of products deemed to be ’sensitive’ in terms of food safety or agricultural health risks and in relation to new regulatory concerns. If the patterns described above are indicative, we would expect to see an increasing level of border interceptions of products in the coming years. This will either increase the transaction costs incurred by certain developing country suppliers or induce them to make adjustments in their production, post-harvest and product monitoring/testing arrangements so as to minimize the occurrence of rejections.

> 28 Hence, despite increased concern about the spread of salmonella, world trade in poultry has increased substantially over the past decade and now accounts for about 10 percent of world consumption.

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