Beef industry celebrates 'symbolic' re-opening of Mexican market

by Janyce McGregor (feat. Colin Robertson)

CBC News
June 28, 2016

Mexico will fully re-open its market to Canadian beef imports on Oct. 1, offering Canada's farmers valuable new customers for their mature cattle this fall.

The resumption of full trade in beef was part of a suite of announcements as Prime Minister Justin Trudeau held bilateral talks with Mexican President Enrique Pena Nieto on Parliament Hill Tuesday.

Canada announced it will lift its visa rules for Mexican travellers on Dec.1, removing another longstanding irritant between the two countries.

Mexico was among dozens of countries that suspended beef trade with Canada after a case of bovine spongiform encephalopathy (BSE) was detected in 2003.

While imports of some products later resumed, live cattle and meat from animals over 30 months of age (referred to as OTM products) were still restricted, cutting off trade in ground beef and other specialty meats.

The Canadian Cattlemen's Association says that normalized trade with Mexico marks the removal of one of Canada's few remaining BSE-related restrictions: only China, Taiwan and Indonesia continue to block certain Canadian beef products.

Fall change timely

CCA president Dan Darling said the reopening gives Canadian farmers the confidence they need to expand their herds in the future. 

"When our production increases to previous levels, I believe that Mexico could again import more than $250 million per year, like it used to," he said in a statement. Between one-quarter and one-fifth of that used to be OTM beef.

The Oct. 1 effective date is timely. 

"The months of October and November are traditionally the time of year when Canadian beef farmers send most of their mature breeding cows to market," Darling said.

Even with the limited access, Canadian beef exports to Mexico have averaged over $130 million annually for the last five years, according to the Canadian Meat Council.

Mexico is seen as a growing market, with expanding middle-class appetites for beef that exceed domestic production.

"The full normalization of trade in beef products with Mexico has been a high priority," said Canadian Meat Council President Joe Reda.

Signal to other new markets

Mexico is considered a high-value market for certain beef products that don't sell as well elsewhere. 

In a release, the council estimated incremental sales worth $10 million annually from Tuesday's announcement. (Incremental sales value results when a new export market is prepared to pay more than current customers for the same products.)

But beef producers are also celebrating the signal this market restoration sends to other potential customers, as the North American industry becomes fully integrated once more.

"The concession by Mexico on beef is really symbolic," former diplomat Colin Robertson told CBC News. 

"We're very anxious to get into other markets — the United Kingdom as well as Asia — and having a clean bill of health from the Mexicans was something that was holding us back a little bit when we were trying to sell into places like Korea, China, Japan and Europe."

Carlo Dade from the Canada West Foundation called the announcement great news, especially for Western Canada. 

But he noted "a huge disconnect" in the fact that many Albertans supported keeping the visa restrictions against Mexico despite its industry benefiting from the beef deal.

"What happened with beef and the visas is an object lesson that will be completely lost on the people of Alberta," he said.