In mid-2009, the United States and the European Union struck an agreement that defused the tension over beef from cattle raised with growth promotants. In exchange for the United States’ commitment to eliminate retaliatory tariffs on imports of certain EU products, the EU agreed – for the first time ever – to create a duty-free quota for imports of high-quality beef.

Expectations were somewhat modest when the quota first opened in August 2009. For the first full quota year of export activity (July 1, 2010 through June 30, 2011) the U.S. Meat Export Federation (USMEF) projected the volume of high-quality U.S. beef exports would be roughly 13,000 metric tons. But based on the current subscription of import licenses for May and June, U.S. beef shipments should reach 16,500 metric tons.

In the attached audio report, John Brook, USMEF regional director for Europe, Russia and the Middle East, explains that these results are particularly impressive because they come at a time when consumption of medium-quality, domestically raised beef is sharply declining in Europe.

With the U.S. export volume approaching 16,500 metric tons, Australia shipping roughly 3,000 metric tons and Canada adding small volumes, the 20,000 metric-ton quota will be nearly fully utilized this year. While this is positive news in terms of trade activity, Brook says it illustrates the urgency of negotiating an expansion of the duty-free quota to allow for further growth. He notes that additional exports of high-quality beef to Europe are possible outside of the duty-free quota, but very difficult to achieve in the current economic climate.