1. Re-inspection of Meat at the Canada-US Border James M. Laws, P.Ag. Executive Director Canadian Meat Council September 2014

2. Canadian Meat Council National industry trade association representing federally-inspected meat processors of beef, pork, poultry, horse and lamb since 1919. www.cmc-cvc.com

3. Canada’s Meat Industry Total revenue from goods manufactured - $24.1 billion (number one in food industry) Total value of meat exports - $4.5 billion Over 1,100 establishments Over 65,000 employees Largest food industry and the 11 th largest manufacturing industry behind motor vehicles, petroleum products and sawmill products 3

4. Pork Statistics 2013 Canadian federally inspected hog slaughter – 20.3 million head Canada’s pork production – 1.93 million tonnes Canada’s pork exports – 1.2 million tonnes Export value total– $3.2 billion Export value to the USA $1.14 billion Canada’s pork imports- 185,000 tonnes Import value- $985 million, $920 million from USA Top Canadian pork export markets – USA, Japan, Russia, China, Australia, Mexico 4

5. Beef Statistics 2013 Canadian federally inspected beef slaughter – 3.2 million head Canada’s beef production – 1.17 million tonnes Canada’s beef exports – 279 thousand tonnes Export value – $1.33 billion Export value to USA $ 902 million Canada’s beef imports- 213,000 tonnes Import value- $1.395 billion; $1.185 billion from USA Top Canadian beef export markets – USA, Mexico, Hong Kong, Japan 5

6. Number of Trucks Each and every day of the year, 365 days per year, on average: 78 truckloads of Canadian meat (20 tonnes per truck) cross the border into the United States of America. That’s 28,150 truckloads per year. 49 truckloads of American meat (20 tonnes per truck) cross the border into Canada. That’s 17,800 truckloads per year.

7. Prime Minister Harper and President Obama Feb 4, 2011 7

8. Beyond the Border: A Shared Vision for Perimeter Security and Economic Competiveness On February 4, 2011, the Prime Minister of Canada and the President of the United States issued Beyond the Border: A Shared Vision for Perimeter Security and Economic Competitiveness. The Declaration established a new long-term partnership built upon a perimeter approach to security and economic competitiveness. This means working together, not just at the border, but “beyond the border” to enhance our security and accelerate the legitimate flow of people, goods, and services. Leaders called for the development of a joint Action Plan to realize this goal, which is embodied in this document.

9. Why is the Canadian Meat Council Speaking Here Today? 9

10. 10

12. Re-inspection of meat at the Canada-U.S. border should be eliminated Meat from the United States that is exported to Canada is already inspected by USDA in accordance with Canadian Food Inspection Agency requirements and the meat is marked with “US Inspected and Passed by Department of Agriculture” legend.

13. Re-inspection of meat at the Canada-U.S. border should be eliminated Canadian meat exported to the U.S. is similarly inspected by the CFIA to the food safety and animal health standards of the U.S. and marked with the Meat Inspection Legend.

14. Canadian Federally Inspected Plants  A Canadian Food Inspection Agency veterinarian and inspection staff are present at all times during slaughter.  A Canadian Food Inspection Agency inspection staff is present in processing plants.  Industry employs full time quality control managers.  Every animal is inspected.

16. US Border Inspection All trucks containing Canadian meat crossing the US border are first screened by US Border Officials. After that, they MUST report to one of only 10 US Inspection Centres along the Canada-US border prior to final destination.

17. Canadian Border Inspection All trucks containing US meat crossing the Canadian border are first screened by Canadian Border Officials. At that time they are told if their truck is the one of the 10% subject to further inspection. This is NOT done at the border but at one of the 125 CFIA Registered Establishments in-land approved to do this.

19. Re-inspection of meat at the Canada-U.S. border should be eliminated The border inspections of Canadian and American meat are merely “re-inspections” of USDA and CFIA inspected meat. Re-inspecting meat in its final package in a box in a truck is not nearly as worthwhile as inspecting meat while it is being processed in the facility- or at a USDA or CFIA regulated further processing plant.

20. Re-inspection of meat at the Canada-U.S. border should be eliminated Performing random inspections of trucks for “contraband” or other illegal cargo is to be expected- for all trucks – not just meat trucks. Stopping each and every meat truck at the border is not necessary- especially when the shipment comes from a supplier who is C-TPAT certified. “We just got our SQF final audit (went very well) and our custom commercial invoices are already going electronically to FSIS. “

21. Re-inspection of meat at the Canada-U.S. border should be eliminated Redirecting Canadian meat trucks to U.S. “inspection centres” also wastes time and fuel and causes extra wear and tear on vehicles through more mileage. “Every driver loses 2-4 hours of driving time having to report to the I-house. If it is busy they wait for the inspector to get free. Losing that road time means that, once the driver hits his 11- 12 hours behind the wheel, paid rest time applies for at least 10 more hours. Cost per hour is roughly $100.00. “

22. Re-inspection of meat at the Canada-U.S. border should be eliminated “PHIS is the USDA computer system that we as exporters will populate before they get to the border. That means the USDA and FSIS will have total control and have almost a flight plan from CFIA Est. 1234 to USDA est. 5678…….even before it reaches the border“

23. SUPPLY CHAIN DISRUPTION AND LOSS OF SHELF LIFE If products are sampled at the Inspection House a supplier could lose 3-10 days of a typical 30 day shelf life. Fresh meats that get delayed can be refused by the customer e.g. some customers in the Southern USA has very tight quality control criteria and will refuse products that don't meet their very tight production specs for deli products. “US companies require Delivery Appointments….to manage the freshness…”

24. Cold-Chain at USDA Import Inspection Centres is Broken All trucks containing Canadian meat crossing the US border MUST then report to a US Inspection Centre prior to final destination. The truck backs up to a warehouse loading dock. The trailer is opened up for inspection at an non-refrigerated loading dock thus breaking the cold-chain.

25. Cold-Chain at USDA Import Inspection Centres is Broken Many I Houses are older- buildings without proper food safety programs such as HACCP and food safety warehouse programs like the CFIA and USDA export establishments have. Temperature shifts while inspections are completed could be 10 degrees or more. Some wonder about I House control of rodents and pests…

26. Re-inspection of meat at the Canada-U.S. border should be eliminated Both Canada and the U.S. currently approve the establishments that are eligible to export to the other country. Periodic audits of these approved establishments are performed, and export eligibility can be revoked at any time should the establishment not satisfy the other country’s standards. 125 Federally registered establishments in Canada are approved facilities for inspection of imported meat products from the United States of America. Of those 125 establishments 50 are meat processing establishments and 75 are cold storage facilities.

28. Canada’s System of Meat Testing is Equivalent to US

30. Canada’s Listeria mono Control in Meat is Equivalent to US

31. Canada’s Meat Inspection Act

32. Canada’s Meat Inspection Regulations

35. Federal Meat Inspection Act Under the Federal Meat Inspection Act (FMIA), FSIS provides inspection for all meat products sold in interstate commerce, and reinspects imported products to ensure that they meet U.S. food safety standards. Federal Meat Inspection Act In the statute, the relevant section is 21 U.S.C. 620 Federal Meat Inspection Act Title 21 - Food and Drugs Chapter 12 - Meat Inspection SUBCHAPTER I - INSPECTION REQUIREMENTS; ADULTERATION AND MISBRANDING

36. §620. Imports. No carcasses, parts of carcasses, meat or meat food products of cattle, sheep, swine, goats, horses, mules, or other equines which are capable of use as human food, shall be imported into the United States if such articles are adulterated or misbranded and unless they comply with all the inspection, building, construction standards, and all other provisions of this chapter and regulations issued thereunder applicable to such articles in commerce within the United States. No such carcasses, parts of carcasses, meat or meat food products shall be imported into the United States unless the livestock from which they were produced was slaughtered and handled in connection with slaughter in accordance with the Act of August 27, 1958 (72 Stat. 862; 7 U.S.C. 1901-1906). All such imported articles shall, upon entry into the United States, be deemed and treated as domestic articles subject to the other provisions of this chapter and the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 301 et seq.): Provided, That they shall be marked and labeled as required by such regulations for imported articles: Provided further, That nothing in this section shall apply to any individual who purchases meat or meat products outside the United States for his own consumption except that the total amount of such meat or meat products shall not exceed fifty pounds.

37. (f) Inspection and other standards; applicability, enforcement, etc.; certifications Notwithstanding any other provision of law, all carcasses, parts of carcasses, meat, and meat food products of cattle, sheep, swine, goats, horses, mules, or other equines, capable of use as human food, offered for importation into the United States shall be subject to the inspection, sanitary, quality, species verification, and residue standards applied to products produced in the United States. Any such imported meat articles that do not meet such standards shall not be permitted entry in to the United States. The Secretary shall enforce this provision through (1) the imposition of random inspections for such species verification and for residues, and (2) random sampling and testing of internal organs and fat of the carcasses for residues at the point of slaughter by the exporting country in accordance with methods approved by the Secretary. Each foreign country from which such meat articles are offered for importation into the United States shall obtain a certification issued by the Secretary stating that the country maintains a program using reliable analytical methods to ensure compliance with the United States standards for residues in such meat articles. No such meat article shall be permitted entry into the United States from a country for which the Secretary has not issued such certification. The Secretary shall periodically review such certifications and shall revoke any certification if the Secretary determines that the country involved is not maintaining a program that uses reliable analytical methods to ensure compliance with United States standards for residues in such meat articles. The consideration of any application for a certification under this subsection and the review of any such certification, by the Secretary, shall include the inspection of individual establishments to ensure that the inspection program of the foreign country involved is meeting such United States standards.

38. WHEREAS the Government of Canada has entered into a Free Trade Agreement with the Government of the United States of America in order : to strengthen the unique and enduring friendship between the two countries and their peoples as befitting great trading partners, to strengthen Canada’s national identity while at the same time protecting vital national characteristics and qualities, to promote productivity, employment, financial stability and the improvement of living standards, to establish a climate of greater predictability for Canadians to plan and invest with confidence and to compete more effectively in the United States and global markets, to build on Canada’s rights and obligations under the General Agreement on Tariffs and Trade and other multilateral and bilateral instruments of cooperation, to contribute to the harmonious development and expansion of world trade and provide a catalyst to broader international cooperation.

39. US Inspection Centre Expenses In the summer of 2012 the Canadian Meat Council surveyed its membership: “I am writing to request information from you related to the fees that are charged to your company by US Inspection Houses for shipments of meat that are exported from Canada to the United States of America. Excellent participation with 26 members responding.

40. US Inspection Centre Expenses What is the fee that your company is charged per truck at the US Inspection House just to verify the documentation? (otherwise known as “skip lot”) Minimum $50 Maximum $225 Average: $105 Based on 77 truckloads per day at a 90% skip lot basis that’s 25,300 trucks x $105 per truck= $2.7 million on average just for skip lots per year. Source: Canadian Meat Council Members

41. US Inspection Centre Expenses What is the fee that your company is charged per truck at the US Inspection House when a load is pulled and held for testing purposes? Minimum $150 Maximum $670 Average: $370 Based on 77 truckloads per day at a 10% sampling basis that’s 2,800 trucks per year x 370 =$1 million on average just for test lots per year. Source: Canadian Meat Council Members

42. US Inspection Centre Expenses What is the total amount of fees that your company pays to US Inspection Houses each year? Total of all respondents:$3.56 million Source: Canadian Meat Council Members

48. Conseil des Viandes du Canada Membres réguliers Canadian Meat Council Regular Members Aliments Trans Gras Inc. BOUVRY EXPORTS Viandes Sherrington

49. Conseil des Viandes du Canada Membres associés / du secteur du commerce de détail / services alimentaires Canadian Meat Council Associate / Retail / Food Service Members