Big Pork Deal Comes Amid Friction Over Livestock Drug

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The proposed $4.7 billion sale of Smithfield Foods, America’s largest pork producer, to China’s biggest meat processing company comes amid significant trade friction between the two countries over meat and livestock.

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China bans ractopamine, a controversial growth-promoting drug that is widely used by U.S. livestock producers. Russia also bans the feed additive and both countries have recently stepped up residue testing in meat, worried about the health effects of the drug. The actions have constrained American meat exports.

The U.S. Food and Drug Administration approved ractopamine as safe more than a decade ago and more than two dozen other countries have followed suit. But China, Russia, the European Union and several other countries question its safety and refuse to accept meat from animals raised on the drug, a beta-agonist that boosts lean muscle growth and improves the rate at which animals convert feed to meat.

Industry experts say the long-running trade fight may have been a factor in the sale of the U.S. pork giant, as China seeks to gain access to more pork, which is by far the country’s most-consumed meat.

“This (deal) is probably a direct result of the ractopamine issue,” said John Saunders, CEO of Where Food Comes From, a third party auditing company that helps companies verify marketing claims.

The U.S. pork industry, which sold more than a quarter of its products abroad last year, is now creating separate ractopamine-free supply chains to gain greater access to overseas markets and meet the demands of both Russia and China.

In March, Smithfield Inc., converted its Tar Heel, N.C. plant – the world’s largest pork processing facility – to slaughter only hogs that were raised without the use of ractopamine.

With the conversion of its third plant, the company’s product line will be 50 percent ractopamine-free as of June 1. The company would not say how much of the ractopamine-free pork it exports to China, but said it is shipping product there “every day.”

Earlier this year, China and Russia demanded that all American meat exports be certified ractopamine-free.

Behind the Global Fight Over a Livestock Drug

The Codex Alimentarius Commission—an obscure but important global food standards-setting entity—has been unable to adopt a residue standard for ractopamine, a drug used to promote rapid growth in pigs, cattle, and turkeys.

Proposed Maximum Residue Limits (MRLs) in beef and pork products have been stuck at the final step in the Codex process since 2008. (For the full companion story on the drug, see “Dispute Over Drug in Feed Limiting US Meat Exports”).

The current deadlock is unusual. The commission adopts dozens of food safety standards each year by consensus, with well over a hundred countries participating.

“Not only is it rare for a standard to be stuck at the final step at Codex, but it’s extremely rare for it to be this contentious,” said Michael Hansen, a senior scientist at Consumers Union, an advocacy group that has participated in the Codex meetings and has been vocal in its concern about the drug.

China and the European Union, which has 27 country votes at Codex, are vehemently opposed to adopting MRLs for ractopamine. They have so far managed to block repeated attempts by the U.S., Brazil, and others who use the drug in livestock production and want a standard adopted.

If a global standard were set, the United States could pursue trade actions against countries that ban meat produced with the drug, such as China, Taiwan, and the EU.

One of the commission’s scientific advisory panels — the Joint Expert Committee on Food Additives — ruled that ractopamine is safe and calculated acceptable MRLs: 10 parts per billion (ppb) in cuts like beef steaks and pork chops. That is below the 30 ppb for beef and 50 ppb for pork allowed by the U.S. Food and Drug Administration.

Based on meat consumption data, the Codex panel proposed higher global residue standards for organ meats, where the drug is found in higher concentrations.

Chinese scientists, who objected to the residue standards, were especially concerned because organ meats such as the lungs, liver, intestines and kidneys are more prevalent in the Chinese diet and thus people who ate them could face higher exposures to the drug.

In 2009, an independent panel of scientists at the European Food Safety Authority (EFSA) sharply questioned the Codex panel’s overall assessment in reaching a safety standard.

The 52-page EFSA report strongly criticized the data and methodology used by Codex to calculate the Acceptable Daily Intake, or ADI, for ractopamine. An ADI, along with data on how much meat consumers are likely to eat, allows the commission to set safe drug residue limits.

Codex used a human study sponsored by the drug maker Elanco to help calculate an ADI for ractopamine, but the EFSA panel concluded that the sample size was insufficient to draw conclusions about what level of ractopamine could be safely consumed by humans.

“If we cannot set an ADI, we cannot set a safe level for consumers,” said Claudia Roncancio-Peña, a scientist who led the EFSA panel. “We need a more complete data set.”

The EFSA panel also questioned whether the Codex standards would adequately consider subpopulations, like pregnant women or people with heart conditions, who may be at higher risk when exposed to even traces of the drug.

Chinese officials are also sensitive about the issue, because the illegal use of growth-promoting drugs such as ractopamine—often called “lean meat powder”—on Chinese pig farms has sickened people, according to local press reports.

Though China has long banned the use of these drugs in livestock production, the government in December officially banned their production and sale, and

19 factories making “lean meat powder” were shut down, according to official Chinese media.
–Helena Bottemiller

The U.S. government initially refused these certification demands, so Russia shut down its market to U.S. beef and pork in February. An official from the U.S. Trade Representative’s office – speaking before the Smithfield deal was announced – said the government is “extremely concerned” about the “unwarranted” bans and continues to engage China, Russia, and others to drop their restrictions.

IMI Global, Inc., a division of Where Food Comes From, has applied for a USDA process verified program that would certify pork and beef as coming from animals not fed ractopamine, or zilpaterol, another beta-agonist widely used in cattle. Under a similar program, the company already verifies that U.S. meat headed for the EU meets their import requirements, which prohibit growth promoters of any kind.

U.S. trade officials would not comment on when a certification program might be approved, but many in the industry view it as inevitable.

“We’ve had conversations with a majority of beef and pork packers about their path forward on this issue,” said Saunders, the CEO of Where Food Comes From. “They’re all engaged in conversations about this.”

The U.S. Meat Export Federation (USMEF) estimates that losing the Russian market will cut more than $560 million in sales, but the overall impact is projected to be closer to $800 million because some of the items Russia buys, like beef livers and hams, will add to the global supply and depress prices.

While closed to U.S. beef, China is an essential market for pork products. Last year, China purchased nearly 16 percent of all U.S. pork, worth more than $700 million, according to the USMEF.

While China has continued to accept U.S. pork as long as companies assure it is ractopamine-free, the Chinese government has stepped up residue testing in recent months and is now demanding third-party certification to verify the additive is avoided. According to USMEF, USDA officials have requested a meeting in Moscow June 17 to present Russian officials with a government-verified program to meet Russia’s demands.

“In the last three months, these issues have really started to hit companies’ bottom lines,” said Keith Belk, a meat safety and quality professor at Colorado State University.

Belk said the situation is “changing day by day” as several companies mull whether they should create a ractopamine-free program for export.

In the U.S., some consumer advocates are worried that the majority of ractopamine-free pork will be shipped abroad.

“American’s aren’t getting the ractopamine-free pork,” said Elisabeth Holmes, a staff attorney for the Center for Food Safety, which recently petitioned the FDA to re-evaluate the drug’s impact on human health and animal welfare and lower the trace residue levels that the agency considers safe in meat products.

The petition, co-filed by the Animal Legal Defense Fund in December, cited a 2012 report by The Food & Environment Reporting Network on NBCNews.com that found ractopamine had been linked to more reported adverse drug experiences in pigs than any other veterinary drug. Reports from producers commonly cited hyperactivity, trouble walking, and death.

The FDA says the reports do not establish the drug caused the adverse effects and maintains ractopamine is a safe and effective compound for food animal protection.

While few consumers are aware of ractopamine’s use in meat production, the drug has been at the center of international trade disputes for several years. The EU questions the science backing the feed additive, China says it’s worried about the higher levels of drug residues that can be found in pig organs, which are part of a traditional Chinese diet, and Russia claims the drug could pose health risks.

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