What is in this article?:
- Examining Canadaâ€™s New Checkoff On Beef, Cattle Imports
- When will the new levy take effect?
Canada’s new cattle import levy of $1/head will essentially mirror a U.S. practice that has been in place for many years.
When will the new levy take effect?
No specific date has been announced. But in news releases and conversations between Canada Beef staff and the U.S. Meat Export Federation (USMEF), late September/October 2013 has been identified as the most likely time frame.
The levy is estimated to generate CAD 600,000 to 800,000 (about $572,000 to $763,000) for Canada Beef, based on the current exchange rate. Based on recent trends, it’s reasonable to project that 75-80% of this amount will be levied on U.S. beef and U.S. live cattle, with the remainder being assessed on imported beef from Australia, New Zealand and Uruguay.
From a financial perspective, it’s not likely that the new levy will impact demand for U.S. beef in Canada, or make U.S. beef less competitive. However, the flow of U.S. beef across the border could be affected if importers encounter problems complying with the new requirements.
This is why it is important to make sure that the levy is widely known and understood by everyone involved. Canada is a critical destination for U.S. beef, so USMEF wants to ensure a smooth implementation process.
Should U.S. cattle producers be concerned?
Only if you have an operation on the Canadian side of the border, and move cattle from the U.S. side onto that operation. This is the only scenario under which a U.S. producer would be required to pay the levy. If you sell cattle to a Canadian operation, however, you may want to make sure your customer is aware of the issue so that he/she does not fall out of compliance with the new import levy requirements.
Joe Schuele is communications director for the U.S. Meat Export Federation.
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