Sandhusker
Well-known member
A nationally recognized agriculture economics expert has released a report titled "An Economic Assessment of Bovine Spongiform Encephalopathy (BSE) and the United States' Cattle and Beef Industries,' which projects the expected economic impact on the U.S. cattle industry caused by the reopening of the Canadian border to live cattle imports.
"U.S. cattle slaughter declined 2.8 million head in 2004 when compared to 2003," said John VanSickle, the report's author, a professor of food and resource economics, and the director of the International Agricultural Trade and Policy Center at the University of Florida's Institute of Food and Agricultural Sciences. "This decrease included the loss of 1.68 million head of imports from Canada and has caused the U.S. beef industry to operate at less than full capacity, which has created increased competition for cattle from U.S. feedlots."
VanSickle's report, issued prior to the reopening of the Canadian border to live cattle, explained that the closed border had two opposing impacts on the U.S. economy.
"First, the reduction in the number of cattle handled by U.S. processors will lead to a loss in economic output by this sector and result in losses of jobs for the U.S. packers that process Canadian cattle," the report stated. "On the other hand, U.S. producers will have more income and likely will increase herd size. An increase in the U.S. cattle herd will lead to more domestic cattle being processed by U.S. processors and added jobs for those processors."
Using data contained in the U.S. Department of Agriculture's (USDA's) economic analysis of the agency's Minimal Risk Region rule (Final Rule), VanSickle modeled the impacts of the Final Rule using a U.S. Input-Output model constructed with Social Accounting Matrix (SAM) multipliers. The model projected the impacts of the Final Rule for the period 2005 through 2007, and results were stated in 2005 dollars.
"Overall results of our analysis of resuming imports of Canadian cattle into the U.S. indicate a net decline of $7.56 billion in U.S. economic output, a decline of 68,442 jobs, and a decline of $3.57 billion in value added products," VanSickle pointed out. "The model also estimates a decline of $2.26 billion in labor income and $294 million decline in indirect business taxes."
The analysis compared the economic impact caused by increased cattle imports from Canada with the economic impact of decreased production by U.S. cattle producers resulting from resumed imports of Canadian cattle.
"The impact of reduced output from U.S. cattle producers due to resumed Canadian imports was estimated as a loss of $12.83 billion in economic output, while the impact of increased slaughter output due to increased supply of Canadian cattle was an increase $5.26 billion in economic output," VanSickle noted.
VanSickle's analysis concludes that the loss to the U.S. economy that would occur if the border remained closed "is more than offset by the gains that are expected from increased production of domestic cattle, and from those U.S. cattle being processed into beef, to a total net gain of $7.56 billion in output over the 2005 to 2007 period."
VanSickle also noted that lost exports already have cost the U.S. cattle and beef industries $3.18 to $4.66 billion, and resumption of Canadian cattle imports likely will magnify the impacts of lost beef export markets on the U.S. economy by another $7.56 billion over the period 2005 to 2007.
"U.S. cattle slaughter declined 2.8 million head in 2004 when compared to 2003," said John VanSickle, the report's author, a professor of food and resource economics, and the director of the International Agricultural Trade and Policy Center at the University of Florida's Institute of Food and Agricultural Sciences. "This decrease included the loss of 1.68 million head of imports from Canada and has caused the U.S. beef industry to operate at less than full capacity, which has created increased competition for cattle from U.S. feedlots."
VanSickle's report, issued prior to the reopening of the Canadian border to live cattle, explained that the closed border had two opposing impacts on the U.S. economy.
"First, the reduction in the number of cattle handled by U.S. processors will lead to a loss in economic output by this sector and result in losses of jobs for the U.S. packers that process Canadian cattle," the report stated. "On the other hand, U.S. producers will have more income and likely will increase herd size. An increase in the U.S. cattle herd will lead to more domestic cattle being processed by U.S. processors and added jobs for those processors."
Using data contained in the U.S. Department of Agriculture's (USDA's) economic analysis of the agency's Minimal Risk Region rule (Final Rule), VanSickle modeled the impacts of the Final Rule using a U.S. Input-Output model constructed with Social Accounting Matrix (SAM) multipliers. The model projected the impacts of the Final Rule for the period 2005 through 2007, and results were stated in 2005 dollars.
"Overall results of our analysis of resuming imports of Canadian cattle into the U.S. indicate a net decline of $7.56 billion in U.S. economic output, a decline of 68,442 jobs, and a decline of $3.57 billion in value added products," VanSickle pointed out. "The model also estimates a decline of $2.26 billion in labor income and $294 million decline in indirect business taxes."
The analysis compared the economic impact caused by increased cattle imports from Canada with the economic impact of decreased production by U.S. cattle producers resulting from resumed imports of Canadian cattle.
"The impact of reduced output from U.S. cattle producers due to resumed Canadian imports was estimated as a loss of $12.83 billion in economic output, while the impact of increased slaughter output due to increased supply of Canadian cattle was an increase $5.26 billion in economic output," VanSickle noted.
VanSickle's analysis concludes that the loss to the U.S. economy that would occur if the border remained closed "is more than offset by the gains that are expected from increased production of domestic cattle, and from those U.S. cattle being processed into beef, to a total net gain of $7.56 billion in output over the 2005 to 2007 period."
VanSickle also noted that lost exports already have cost the U.S. cattle and beef industries $3.18 to $4.66 billion, and resumption of Canadian cattle imports likely will magnify the impacts of lost beef export markets on the U.S. economy by another $7.56 billion over the period 2005 to 2007.
