Potential Trade Effects on Selected Agricultural Exporters to EU Under Regulation 1107/2009 (“Hazard Based Cut-Offs”)

In 2009, the European Council adopted Regulation 1107/2009 revising the system used to regulate approval of the materials used in crop production to control damage from insects, weeds, animal pests and fungi.

In this regulation, a new set of categories was established under which substances deemed to be endocrine disruptors (ED), carcinogens, mutagens, or reproductive toxicants (CMR) will be subject to new approval/use criteria based solely on the identification of the hazard properties of these substances without an evaluation of the risk to human health at levels to which consumers are exposed to their residues in food. Substances which fall into these categories (“cut-off” substances) will be prohibited from use in the European Union, and current maximum residue levels (MRL) could be either withdrawn or set at a default level of 0.01 ppm.

If important crop protection substances are no longer available for use on products exported to the EU, commodity producers will likely face financial consequences either from lost export markets, the costs of adapting different production systems to maintain those markets or to develop new export markets outside the EU. Depending on the substances eventually selected for application of the cut-off criteria, actual trade effects in each country will depend on the ways in which the exporting producers and industry can respond to the loss of particular substances or groups of substances.

This report examines the potential trade effects on selected agricultural exporters to EU Under Regulation 1107/2009 (“Hazard Based Cut-Offs”).