Ecuadorans Visit USMEF for Overview of U.S. Beef Industry, Global Meat Trade

Producers, traders and food industry representatives from Ecuador visited USMEF headquarters in Denver this week to learn about the organization’s role in U.S. red meat exports and gain a better understanding of the U.S. beef industry.

The Ecuadoran group is part of the USDA’s Cochran Fellowship Program, which provides training opportunities to farmers and other agriculture industry professionals from emerging markets. Their participation was organized through the University of Missouri, with the goal of providing them with information related to agricultural trade and marketing.

USMEF Technical Services Manager Cheyenne McEndaffer (far right) explains U.S. beef access in South America to a group of producers, traders and industry representatives from Ecuador

Dan Halstrom, USMEF senior vice president for marketing, explained to the team how USMEF works in markets around the world to generate demand and increase sales of U.S. red meat. He also updated the group on global beef consumption and production trends.

USMEF has had great success in many markets, Halstrom said, but challenges remain in others – and Ecuador is a prime example.

While the U.S. has long had pork access to Ecuador, the market was closed to U.S. beef for more than a decade following the 2003 BSE case. Beef exports to Ecuador resumed in the spring of 2014, but a year later the Ecuadoran government imposed a safeguard that added a 45 percent import surcharge to numerous food and consumer products, including beef and pork, from all exporting countries. For U.S. beef, the surcharge is on top of the 20 and 22.5 percent duties for muscle cuts and offals, respectively.

USMEF Technical Services Manager Cheyenne McEndaffer, who gave an overview of the U.S. industry’s efforts to improve market access to Ecuador and assist in the export process, said the advances made by the U.S. in recent years have been offset by the import surcharge because it makes U.S. beef very expensive. The ambiguous import license application process in Ecuador also makes it difficult for importers to access steady volumes of meat.

U.S. beef has an established presence in Peru and Chile, and Colombia has recently emerged as a very promising market. The U.S. industry is anxious to expand this success to Ecuador, but without a free trade agreement and the expensive import surcharge in place it continues to be a challenging market to develop.

“In markets like Colombia, where U.S. beef imports have increased dramatically, they have embraced the product,” McEndaffer said. “Colombia is a real success story, and we’re getting in more beef offal as well as increased volumes of high-end meat into the retail and foodservice sectors. We are hoping to carry over what is happening in Colombia to Ecuador, if we can eliminate some of these trade barriers.”

The Ecuadoran team acknowledged the high cost of importing U.S. red meat, especially beef. They are hopeful the surcharge can be lowered, if not removed, in the near future.

The 45 percent surcharge was originally scheduled to be in effect for a period of 15 months, meaning it would end on June 11, 2016. But Ecuador announced this spring its intention to extend its import surcharges for an additional year. Under this plan, the surcharges would be reduced by one-third in April 2017 and phased out completely in June 2017. The World Trade Organization (WTO) is examining whether the surcharges can be economically justified, but has allowed them to stay in effect during the WTO review.

Among other South American countries, U.S. beef has no access to Venezuela, Bolivia, Paraguay and Argentina. Brazil is also currently closed, but USDA recently announced that the Brazilian market will soon reopen to U.S. beef.

USMEF Senior Vice President for Marketing Dan Halstrom (far left) provides an overview of USMEF’s role in red meat exports and a look at global meat trade