Council Outlines Export Threats From Missing, Inconsistent Maximum Residue Levels

Understanding the impact of maximum residue levels (MRLs) can be complicated but is important to keep grain flowing from the farm to international end-users.

The U.S. Grains Council (USGC) collaborated with the National Corn Growers Association (NCGA) and MAIZALL – the international maize alliance – to submit comments on the global economic impact of MRLs to the U.S. International Trade Commission late last year.

The groups are collectively concerned with a growing trend in which countries are moving away from international standards or reliance on science-based, risk-based approaches when setting MRLs for agricultural products, resulting in new barriers to trade.

The testimony outlines how crop protection products work as defense mechanisms against pest, disease and weather challenges, how they are regulated and how they have contributed to a more reliable food and fuel supply.

“Whether through the lens of the local farmer, export market development efforts or the macro trends of farming in the Americas, we hope to shed light on the impacts and considerations that high-volume, bulk commodities face when moving around the globe,” the groups wrote.

“We believe that crop protection products play a critical role in the global food production system and that missing or low maximum residue levels can have lasting and detrimental impacts on our ability to sustainably supply the world with its food and feed.”

MRL 101

By definition, an MRL is a regulatory standard that reflects both risk and hazard from exposure in a given environment, and then sets a scientific limit that reduces that risk well below any level that could be considered a health hazard. In other words, MRLs ensure food and feed products contain limited amounts of residue from crop protection products – at a level that varies depending on the specific product.

In the United States, MRLs are set during the registration of a crop protection product and are regularly reviewed. This number does not represent a food safety measure. Rather, MRLs serve as a way to ensure farmers are following safe label practices when using crop protection products. For the most part, if a farmer correctly follows the label, the crop should not trigger a residue level above that of the MRL for that product.

Managing MRLs around the world is more complex. Labels for crop protection products in the United States are based on the U.S. MRL. If grain is destined for export, that grain must meet both the MRL for the United States and that of the importing country – making export market MRLs crucial for market access.

Internationally, crop protection companies are responsible for either submitting an MRL or an import tolerance – a similar residue level used when a substance is not used domestically but is important for imported products. Some countries adopt MRLs set by an external market or an international body like Codex Alimentarius (Codex). Others have their own national system through which they set their own MRLs.

When MRLs Don’t Match

When MRLs don’t match up or are missing, trade disruptions can and do occur. A missing MRL, in a country that defaults to Codex for example, would mean that any residue detection above 0.00 would trigger an MRL violation until Codex can set and approve an MRL – a process that can take years.

Also – if an MRL is set to a different level than the exporting country, serious headaches can occur for global trade, particularly for bulk commodities. If an MRL is not aligned with either the U.S. MRL or international standards established by Codex, there is increased risk for rejected shipments or additional testing – both of which add costs.

MRLs Acting As Non-Tariff Trade Barriers

In countries like Japan and South Korea, the regulatory system related to changes in MRLs is transparent and science-based. While reconciling these differences between MRLs there and in the U.S. is still challenging, governments and industries often work together to address any potential trade issues.

However, in other parts of the world, missing or diverging MRLs are starting to work as non-tariff trade barriers. Most alarming is the European Union’s (EU’s) changing preferences for a hazard-based approach to renewing authorization of existing crop protection products, rather than a risk-based approach.

Hazard Vs Risk
Click the image to view a larger version of this infographic.

To illustrate the difference, take the sun as an example. Hazard only measures the danger of skin cancer from the sun, and no other factors. Measuring risk takes into consideration both hazard (the sun) and exposure (how long was the person outside? Were they wearing sunscreen or long sleeves?) – giving a more realistic evaluation of a product or situation.

The proposed EU hazard-based approach means an increasing number of active ingredients are losing their authorization, which would mean the reduction or removal of the MRLs of these long-used products. At near-term risk are commonly used products like glyphosate, malathion, propiconazole and lambda-cyhalothrin. These products, which are approved in producing countries like the United States but not in the EU, risk becoming subject to an MRL of 0.01 mg/kg default or even lower at any level of detection. These changes would cause serious issues for the grain trade.

“When MRLs are set at zero – an impossible standard – risk and liability for grain traders becomes too high, effectively shutting off a market to exporting countries,” the testimony reads. “In such examples, we see MRLs being used as non-tariff trade barriers to keep competition for domestic markets at bay.”

In the case of the EU, U.S. farmers could lose access to products that have undergone rigorous testing, received U.S. approval and are internationally recognized as safe and legal – all to continue supplying an overseas market. Third nations could also ban or restrict the use of the same products in a ripple effect – ignoring international science-based, risk-based standards in favor of a desire to export to large markets like the EU.

Both of these situations result in barriers to trade – and are of mounting concern as MRL issues become more prevalent.

The Council actively monitors many of the top substances used in corn, barley and sorghum production in the United States, so USGC staff around the world can help respond to questions or concerns from importing countries or advocate for sound and fair enforcement. The consequences of loss in sales to export markets or losing the ability to use crop protection products is too important to ignore.

“Even with strong coordination, national MRL systems create uncertainty and potential market access risks,” the testimony stated. “As more of these national systems emerge, the impact on exporters to stay abreast of changes and potential risks can be overwhelming and incredibly complex.”

Read the full testimony to the International Trade Commission on MRLs.