Progress 02/15/14 to 02/14/17
Outputs
Target Audience:Gave a selected presentation at the 2016 AAEA Annual Meeting in Boston, MA. Other audiences include professionals that accessed the selected paper through AgEcon Search. Changes/Problems:
Nothing Reported
What opportunities for training and professional development has the project provided?
Nothing Reported
How have the results been disseminated to communities of interest?At this point, we have disseminated the results from this project throughconference presentations at the 2014 and 2015 Annual Meeting of the International Agricultural Research Consortium; as part of an organized symposium at the 2015Southern Agricultural Economics Association Annual Meeting; and at the 2016 AAEA Annual Meeting. In addition, we made a presentation at the American Enterprise Institute Emerging Scholars Workshop in May 2016. We continue to work on getting manuscripts accepted for publication in peer reviewed journals. What do you plan to do during the next reporting period to accomplish the goals?
Nothing Reported
Impacts
What was accomplished under these goals?
Sanitary and phytosanitary (SPS) measures are not new, but their significance in international agri-food trade continues to grow. Despite recent researchefforts, there is not a consensus in the current literatureabout the impact of SPS measures on trade nor has it led to a prescribed framework for how to address SPS policy reforms in multilateral and bilateral trade negotiations. In this project, we focused on a specific type of SPS measures that features prominently in current trade negotiations, namely food safety standards in the form of maximum residue limits (MRLs). First, we constructed a comprehensive database of country-and-product specific MRLs for global fresh fruit and vegetable trade and developed a novel bilateral stringency index to quantify the degree of MRL regulatory heterogeneity between trading nations for the years 2013 and 2014. Second, we developed a formal econometric model to investigate the trade restricting nature of these measures. The results suggest that for any given fresh fruit or vegetable product, importer MRL standards that are stricter than exporter MRLs can impart significant reductions in bilateral trade, with a 1% increase in the MRL stringency by importers reducing trade by 0.9%.However, when MRL policies are roughly equivalent, the actual restrictiveness of this SPS policy diminishes dramatically. In addition, we find that stricter standards on insecticides by importers have a larger impact on trade than stricter standards on herbicides or fungicides. Objective 1: Complete and update the SPS treatments database Collected data on phytosanitary measures applied to US fresh fruit and vegetable exports for the period 1999 - 2009. Data collection for later years was not possible because the access to PCIT required clearance and the data in PCIT is organized differently than in the EXCERPT database. Objective 2: Create a new data of maximum residue limits and stringency indices Data on maximum residue limits (MRLs) for 2013 and 2014 was collected from the International Maximum Residue Level Database for 85 countries and 51 fresh fruit and vegetable product categories. Of these 85 countries, 31 set their own standards, 27 defer to Codex standards, and 16 defer to EU standards. Data was also coleected from USDA/NASS on the chemicals used intensively in fresh fruit and vegetable product in the United States to identify the key chemicals to include in MRL stringincy indices. Using the Codex standards as the reference MRL, bilateral stringency indices were computed for all countries that do not defer to entirely to Codex standards. Across all products and trade partners, Thailand, Malaysia, Saudi Arabia, Canada, India, Singapore, South Africa, China, the US, New Zealand, and Japan have less stringent MRLs compared to Codex. Among TPP countries, Australia and Chile have the most stringent MRL compared to Codex. The EU, has the 8th highest stringency index relative to Codex. Objective 3: Utilize these datasets in an econometric estimation The MRL database was merged with trade data for fresh fruits and vegetables and a gravity model was estimated. On average, a 1% increase in the overall bilateral stringency index decreases fresh fruit and vegetable trade by 0.9%. When disaggregating the overall bilateral stringency index into separate indices for fungicides, herbicies, and insecticides, we found that an increase in the stringency indiex for insecticides decreases fresh fruit and vegetable trade more than increases in the herbicide or fungicide stringency indices. These results are reported in a paper by Hejazi, Grant, and Peterson that was presented at the 2016 AAEA Annual Meeting in Boston, Massachusetts. Objective 4: Identify where international harmonization of SPS measures would ehance fresh fruit and vegetable trade, in particular to the EU and Trans-Pacific Partnership (TPP) markets Christine Wieck and Bettina Rudloff completed a paper entitled"The regulation of EU food safety in trade agreements: Strategies for regulatory cooperation," that discusses regulatory cooperation in trade agreements on food safety with a special attention to the EU-US negotiationsfor the Transatlantic Trade and Investment Partnership. Regulatory cooperation on food may take different forms: mutual recognition of standards, harmonization of standards or different types of cooperation in the regulatory process. Even though in most trade agreements, language is included that deal with food safety standards, a complete harmonization, the ultimate objective of regulatory cooperation, of food systems is achieved in only a few cases. However, there are many interim stages of regulatory cooperation on food safety issues that may help to reduce trade costs and regulatory burden without jeopardizing food safety standards and perceptions. The EU approach differs by partner country and product. In particular with the US, different solutions have been found for different food safety issues. These solutions such as accepting equivalence of measures in the case when the risk assessment was similar or barter deals when the risk assessment diverged show solution strategies that can be used when food safety regulation cannot be harmonized. Thus, a "race to the bottom" as often feared is not necessary and does not necessarily take place. Countries can maintain their food safety protection levels and find solutions to food safety conflicts. Apart from the EU-US debate, in many trade agreements, the SPS and TBT rules are set as standards. Thus, if further harmonization or equivalence of public international food safety rules is to be achieved, the leadership of the standard-setting international bodies and the SPS committee should be fostered. Keiichiro Honda and Tsunehiro Otsuki completed a paper entitled"The Effect of Pesticide Residue Standards on Japanese Orange Imports: An AIDS Model Analysis," that assessed the effect of Japanese pesticide residue standards on its orange imports using monthly data from major exporter countries and a domestically produced counterpart, mikan, from 2005 to 2015. They found that a more stringent (lower) pesticide MRLs for oranges in Japan led to increased orange imports from Australia, Brazil, the United States. A second paper by Tsunehiro Otsukientitled"Consumer's Valuation of Food Safety Regulations: An Application of Conjoint Analysis," evaluated consumer willingness-to-pay (WTP) for food safety reguations in Japan, a key TPP market. It employs conjoint analysis based on a choice experimentof the demand for poultry meatby Japanese consumers. Several choice alternatives regarding products' safety and general attributes, whose levels are systematically set, elicit consumer preference toward these attributes. The safety attributes include suppliers' compliance with Japanese standards for antibiotic residues and radioactive contamination and past avian influenza incidence. The results of the mixed logit model suggest that the WTP for compliance with the antibiotic residue and radioactive safety standards is 86.6% and 76.6% of the average product price, respectively. Moreover, the WTP for the antibiotic residue and radioactive safety standards is found to be higher for richer consumers, women, and respondents with children.
Publications
- Type:
Conference Papers and Presentations
Status:
Accepted
Year Published:
2016
Citation:
Hejazi, Mina [presenter], Jason H. Grant, and Everett B. Peterson. "Hidden Trade Costs? Maximum Residue Limits and US Exports to Trans-Atlantic and Trans-Pacific Trading Partners." Presented at the 2016 AAEA Annual Meeting, Boston, MA, July 31-August 2, 2016.
- Type:
Journal Articles
Status:
Under Review
Year Published:
2017
Citation:
Honda, Keiichiro and Tsunehiro Otsuki. The Effect of Pesticide Residue Standards on Japanese Orange Imports: An AIDS Model Analysis.
- Type:
Journal Articles
Status:
Under Review
Year Published:
2017
Citation:
Otsuki , Tsunehiro . Consumers Valuation of Food Safety Regulations: An Application of Conjoint Analysis.
- Type:
Journal Articles
Status:
Under Review
Year Published:
2017
Citation:
Wieck , Christine and Bettina Rudloff. The regulation of EU food safety in trade agreements: Strategies for regulatory cooperation."
- Type:
Other
Status:
Accepted
Year Published:
2016
Citation:
Grant, Jason [presenter] and Mina Hejazi. "Hidden Trade Costs? Maximum Residue Limits and US Exports to Trans-Atlantic and Trans-Pacific Trading Partners." Presented at American Enterprise Institute Emerging Scholar Workshop, May 17-19, 2016
|
Progress 02/15/14 to 02/14/15
Outputs
Target Audience: Gave a presentation at two professional meetings on some preliminary results from MRL data. Changes/Problems:
Nothing Reported
What opportunities for training and professional development has the project provided?
Nothing Reported
How have the results been disseminated to communities of interest?
Nothing Reported
What do you plan to do during the next reporting period to accomplish the goals?
Nothing Reported
Impacts
What was accomplished under these goals?
Objective 1: Completed the collection of data on phytosanitary measures applied to US fresh fruit and vegetable exports for the period1999 - 2009. Collecting data for later years was not completed because the access to PCITrequired clearance and the data in PCITis organized differently than in the EXCERPT database. Objective 2: Data on maximum residue limits (MRL)for 2013 and 2014 was collected from theInternational Maximum Residue Level Database. We also have looked into MRL data fromHomologa, which has a long time period available, as well. We also collected data from USDA/NASS on the chemicals used intensively in fresh fruit and vegetable product in the United States that will be used in calculating stringency indices.
Publications
- Type:
Conference Papers and Presentations
Status:
Accepted
Year Published:
2014
Citation:
Grant, Jason [presenter], Everett Peterson, Kurt Klein. Evaluating the Stringency of Maximum Residue Limits for Fresh Fruits and Vegetables. Presented at the Annual Meeting of the International Agricultural Trade Research Consortium, San Diego, CA, December 7-9, 2014.
- Type:
Conference Papers and Presentations
Status:
Accepted
Year Published:
2015
Citation:
Hejazi, M., J. Grant, and E. Peterson. "Pesticide Residues and Trade: How Maximum Residue Limits May Impact US Fruit and Vegetable Exports to the EU and TPP." Invited paper as part of the Organized Symposium "Mega-Regional Trade Agreements and U.S. Agriculture." Southern Agricultural Economics Association Annual Meeting, Atlanta, GA, January 31 - February 3, 2015.
|