BSE - EU goes for the kill
- January 2001
This Opinion was featured in the January 2001 issue of the the Anglia Farmer and Contractor
Facing a growing crisis of consumer confidence in beef, the European council of agriculture ministers at an emergency meeting in December agreed to some uncharacteristically thorough measures to combat BSE.
One, the EU wide ban on feeding meat and bone meal to any type of livestock, was clearly difficult to get accepted as long as most member states were able to claim to be free of BSE. Attitudes have clearly changed with the rising incidence of BSE in France, including the realization that many cases were going unreported.
The six-month limit to the ban was almost certainly a necessary compromise, with no doubt many member states hoping to get it lifted if there is no further evidence of the spread of the disease.
The more surprising decision was the 'purchase for destruction' scheme, to remove from the food chain all cattle over 30 months old, also on an EU-wide basis. Such a programme has proven successful in Britain, but the cost has been phenomenal. And the European Union's cattle population is about five times that of Britain.
As only one-third of member states (Britain, Ireland, Portugal, France and perhaps Belgium) have had more than isolated cases of BSE, this might seem like overkill. But on closer examination it makes sense.
Exceptions will be made for cattle subjected to recently developed rapid BSE-detection tests and assessed to be BSE free. All at-risk animals are now being tested and all animals aged over 30 months will be tested from July 1.
In the past, when there was lower sensitivity to the danger of BSE, these tests were considered not good enough. Now, as an adjunct to the 30-month scheme, they've been accepted.
The 30-month scheme really starts to make sense in the marketplace,where there appears to be a fortuitous confluence of political and economic interests.
The crisis of confidence in beef is reported to have resulted in a 40 per cent cut in demand and up to a 25 per cent drop in cattle prices. It was never politically feasible for the European Union to leave French beef producers in the lurch in their time of greatest need.
Provisions enhancing market support through intervention buying of beef were introduced both prior to, and as part of, the programme agreed to by the council of agricultural ministers. It is cheaper simply to dispose of large numbers of cattle and pay the necessary compensation than to go to the expense of buying, preparing and storing beef.
The comparative costs quoted are 1400 euros/tonne (about £2200) for destruction and compensation and 2000 euros/tonne for normal intervention.
Further disposal through the scheme and resulting market support will be greatest immediately but will decline as more cattle are excluded through testing. After six months only animals tested as having BSE will be destroyed.
The hope is that consumer confidence will return to absorb the increasing supply of beef resulting from declining levels of over 30-month disposals.
The European Commission described this element of the scheme as "rebalancing the market." Whether a return to normal beef market conditions will be as smooth as planned is another matter.
It will be another four or five years (the incubation period for the disease) before it becomes clear if these measures have actually achieved their desired goal.
Disease incidence will surely increase in the short term as universal testing is implemented; partial testing over the last few months has significantly increased French reports.
More uncertainty exists for member states known to be at risk, having fed potentially BSE-infected meat and bone meal in the past, but which have, against independent expectations, not reported until recently any incidents. Those countries that have actively opposed meat and bone meal restrictions will either be vindicated or vanquished.
More importantly, an increase in BSE reports in these countries will likely delay the recovery in beef demand, even with the new precautions in place. If the testing turns up more BSE than expected, more "'ebalancing' comes into play.
Because most member states have whole-herd slaughter policies, a single report of BSE results in the output from the entire herd being removed from the market. The 100 cattle reported as having BSE in France this year are of no importance to beef supply, but the 100 herds eliminated could be.
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