Pesticides Residues: How to ensure EU agri-food competitiveness?

Speakers: Bitterhof Almut, Gordon Laity Eileen, Boulova Anna, del Mar Fernández Poza María, Ojepat Okisegere, Knotek Ondrej
Moderator: Michalopoulos Sarantis

On the 2nd of June 2021, PubAffairs Bruxelles organised an afternoon session on the questions on pesticide residues and how to ensure EU agri-food competitiveness with Ms Almut Bitterhof, Deputy Head of Unit, Pesticides and biocides, Directorate-General for Health and Food Safety (DG SANTE) – European Commission, Ms Eileen Gordon Laity, Secretary General, European Coffee Federation (ECF), Ms Anna Boulova, Secretary General, European Federation of the Trade in Dried Fruit, Nuts, Processed Fruit, Vegetables and Fishery Products (FRUCOM), Ms Mar Fernandez, Director, Spanish Association of Egg Producers (ASEPRHU) and Mr Okisegere Ojepat, Chief Executive Officer, Fresh Produce Consortium of Kenya.

Mr Ondrej Knotek MEP (Renew/CZ) gave an introductory speech.

The debate was moderated by Sarantis Michalopoulos, journalist, Euractiv.

Sarantis Michalopoulos introduced the speaker and briefly introduced the issues at stake in this debate and gave the floor to Mr Ondrej Knotek MEP.

Ondrej Knotek MEP began his introductory speech by referring to the holistic approach adopted by the European Commission over the last three years in order to promote the sustainable development of the European economy and society. This horizontal approach to foster sustainability, according to the MEP, is well reflected in the EU Green Deal, which aims at overhauling the European economy to tackle the emerging environmental and climate challenges.

Changing the functioning of the whole value chain inside and outside the EU, the MEP continued, does not come without difficulties, as a number of sectors are undergoing substantial transformations that will require extensive cooperation among EU institutions, the private sector and third countries, as well. As far as the agri-food sector is concerned, the MEP emphasised the significance of the EU as exporter and importer of food, fact which gives the question of MRLs a further layer of complexity.

In this connection, the MEP explained that the current European ambition to cut 50% of pesticide by 2030 use will have an impact on both the EU industry competitiveness and trade relations with third countries. The MEP also acknowledged that there is also a pressing need to increase sustainability on a global scale. However, he stressed the importance of setting realistic standards, while providing the required support to European farmers in managing the green transition, as well as to trading partners in adapting to the new setting.

He further added that the WTO rules on food safety and use of pesticides should remain the foundation of any legislation regarding this domain. The MEP concluded his speech by pointing out that improving the sustainability of the food system, maintaining the competitiveness of the agri-food sector and ensuring food safety will be the three main objectives to pursue in order to succeed in a successful implementation of the EU Green Deal.

Sarantis Michalopoulos presented the panel and began the discussion by asking Almut Bitterhof about the current state of play concerning pesticides regulation and what developments are foreseen in this domain, both inside and outside the EU.

Almut Bitterhof began by emphasising the role of the EU Green Deal as the heart of several EU policies evolutions. More specifically, she said that the Farm to Fork Strategy (F2F) presented in May 2020 is setting new ambitious objectives with the goal of unifying the food sector under the flag of sustainability. The speaker also specified that the strategy has a holistic approach, as it aims to both lead the transition towards a sustainable food system and promote healthier food habits among citizens that are more respectful of the environment, while fighting climate change. For these reasons, the speaker emphasised that the European Commission has initiated a global dialogue in order to understand the position of non-EU countries, as the objective of environmental protection and the fight for climate change need international cooperation.

She then proceeded in explaining how the MRLs legislation is at the hearth of EU policies regarding pesticides and its primary aim belongs to the domain of consumer protection, along with the objective of facilitating trade. She also stated that food safety in Europe has the highest standards in the world for both imported and internally produced food. Whereas, the perspective changes of MRLs policies will also take into account certain environmental aspects of the agri-food production.

Subsequently, Ms Bitterhof went into detail by explaining that the EU’s policies will remain compliant with WTO rules and obligations and stated that the EU, in addition to ensuring food safety, is aiming to take certain environmental issues into account when assessing import tolerance requests for substances that pose global environmental concerns.

In even greater detail, Ms Bitterhof explained that the EU has identified two areas where more ambition will be required. The first is the protection of pollinators, as some substances, such as neonicotinoids, have been proven to contribute significantly to the decline of bee populations worldwide. The second area concerns persistent, bio-accumulative and toxic (PBT) substances or very persistent and very bioaccumulative substances (vPvB). For substances of these two areas the EU will, based on the current state of science, lower as a first step the existing maximum residue levels and not grant new import tolerances any longer.

Ms Bitterhof concluded by assuring that the European institutions’ action is not aiming to disrupt trade with third countries, but to create common sustainable criteria in order to encourage other countries to adopt similar approaches towards environmental protection. Indeed, she reiterated, fighting climate change and ensuring biodiversity protection are among the main targets of the EU Green Deal and F2F Strategy and they will require global cooperation to be achieved.

The moderator proceeded by asking Eileen Gordon Laity how the changes to Maximum Residue Levels (MRLs) are expected to impact the coffee industry, especially in consideration of the high trade volume of coffee in the old continent.

Eileen Gordon Laity started by presenting the European Coffee Federation, an umbrella organisation for the European coffee trade and industry which speaks on behalf of over 700 companies, ranging from SMEs to internationally operating companies, and represents approximately 35% of the world’s coffee trade volume. She subsequently explained the functioning of the industry and the views from producing countries with regard to the EU, which, she emphasised, has the highest coffee consumption per capita in the world.

Ms Gordon continued by providing the example of exports from developing countries, such as Honduras, Brazil and Vietnam that respectively export 60%, 55% and 40% of their coffee production to the European Union, according to Eurostat data. The speaker stated that data also show that these countries, among others, are highly dependent on their exports to the European market, making them susceptible to sudden changes in demand or trading rules. She further highlighted that each food producing country has its specific way of organising agricultural production and ensuring the highest quality of products, making it more difficult for their industry to adapt to changes stemming from international regulatory evolutions.

Furthermore, Ms Gordon added that the lack of international harmonisation of rules regarding MRLs poses an additional burden to exporting countries as they have to adapt to multiple legislations in order to maintain a stable trade flow. For these reasons, she emphasised the need to have an internationally harmonised approach to MRLs.

The speaker went further into detail by clarifying the nature of the coffee industry, in which 12 million small and medium enterprises (SMEs) and family businesses are responsible for 70% of the global production. In addition, she explained that coffee goes through several intermediaries during its production process. As a consequence, she added, it is extremely burdensome to track the origin of the product and the plant protection measures that have been applied by farmers.

As far as MRLs are concerned, Ms Gordon highlighted that the industry requires more predictability when it comes to large importers creating new standards, as producers require time to adapt to changes. She also added that the question of developing countries must be taken into account as changing requirements for pesticides and ensuring traceability of the product may prove particularly expensive, especially when alternatives are unavailable or economically not viable.

In conclusion, Ms Gordon called for more engagement between the EU and producing countries to ensure the economic sustainability of the global coffee value chain and in order to identify and implement fair and appropriate alternatives to perspective legislative changes.

The moderator then moved on to ask Ms Anna Boulova about the composition of the dried fruit and fishery industry and how the sector is reacting to a potential change in the MRLs.

Anna Boulova started her speech by saying that, similarly to the coffee industry, FRUCOM is composed largely of SMEs which rely on imports of raw materials from third countries. She also pointed out the compliance of all imported and EU foodstuffs with the highest food safety standards by explaining that EFSA report from 2019 showed that 96.1% of all samples were below legal MRLs. After considering the measurement uncertainty 2.3% samples were found to be non-compliant.

Ms Boulova continued by stressing the fact that respecting the standards set by European institutions is also in the industry’s interest. In fact, she said, non-compliance with food safety criteria would result in food waste and further costs due to the withdrawal of products from the market and, ultimately, in a loss of reputation among trading partners.

Subsequently, Ms Boulova explained that one of the greatest challenges for the sector is to remain competitive while dealing with the uncertainty of food regulation. She highlighted that commodities, such as nuts and dried fruits, go through a long process before arriving to consumers (e.g. harvesting, drying, storage and transportation) and it could pass up to a year before they are sold as a final product.

Taking these factors and the fragmentation of the industry into account, Ms Boulova concluded by emphasising the difficulty for the sector she represents to remain competitive. Moreover, while praising the transparency of European institutions on these matters, she stated that to improve compliance further, ensure legal certainty and to promote competitiveness, the crop and food cycles must be taken into account when amending legislation. Six months of transition periods are not sufficient. The whole chain must be certain that legally manufactured products stay legal.

Turning to Mar Fernandez, Sarantis Michalopoulos asked her what the expectations of the livestock sector with regard to the Farm to Fork Strategy are (F2F).

Mar Fernandez began by describing the vast regulatory environment that governs the livestock sector in Europe. She subsequently stated that, being highly regulated, this sector of the EU economy can ensure the global highest standards in terms of quality, animal welfare and food safety. However, she also highlighted that some of the restrictions imposed by the EU are already undermining European competitiveness in the global market. In this regard, she took the example of the restrictions in the use of GMOs and the ban on PAPs as feed ingredients for livestock which has severely increased the costs of feeding animals.

In addition, Ms Fernandez pointed out that the EU is unable to produce the necessary plant proteins for animals, making Europe’s agri-food sector particularly reliant on grains and soy import from third countries. The prices for these products, she continued, are extremely volatile and susceptible to speculations based on harvesting forecasts, changes of policy and financial volatility of agricultural commodities. Ms Fernandez subsequently added that meat production and animal-derived products in the EU are currently fulfilling the highest standards for consumers and further regulations in MRLs might not add a real value in terms of quality or food safety.

The speaker also remarked that further restrictions in the use of pesticides might reduce the availability of imports for animal feed, creating barriers to trade and increasing dramatically the costs for the industry. Ms Fernandez went on by saying that the EU should focus on creating a common set of rules for animal products at global level through multilateral bodies, such as the WTO, instead of adding further regulation to the European domestic market.

She concluded by stating that there is already an imbalance, as the European livestock sector must respect strict rules, which are often not shared by third countries that import animal products in the EU, and at the same time is competing in the global animal protein market with higher regulatory cost. For these reasons, she summoned EU institutions to consider more in depth the question of the competitiveness of the European agri-food sector when elaborating new policy strategies.

Turning to Okisegere Ojepat, the moderator questioned him on the position of third countries regarding MRLs and how they are reflected in their trade agreements with the EU.

Okisegere Ojepat began by stating that the modifications of pesticide use and MRLs that the EU wants to apply can pose a substantial risk for non-EU actors, particularly in developing countries such as Kenya. He stressed the importance of the fact that the exchange of agricultural products is the primary source of income for developing countries and added that any substantial regulation that may affect the sector could lead to trade disruptions. In this connection, the speaker expressed the concern that EU trading partners have not been consulted and that their views risk to be excluded from future decisions.

Mr Ojepat further explained that, due to their geographical position and climate, African countries have different needs compared to the EU concerning pest control and plant protection. Consequently, he stated that excluding agricultural goods from the European domestic market that make use of specific pesticides might prove detrimental for Kenya, as well as for other developing countries, which are slower to adapt to changes and often lack viable alternatives.

The speaker went on to describe how reducing the use of pesticides by 50%, as the new Farm to Fork Strategy (F2F) aims to achieve, entails a productivity loss and would lead to an unsustainable production model in Kenya. The also explained that international standards for MRLs are already in place, as the Codex Alimentarius, notably the cornerstone of international legislation on food, set clear rules to ensure food safety and consumer protection. For this reason, the speaker argued that unilateral actions from the EU on MRLs could create confusion among trading partners, as they will have to adapt to several different legislations in order to trade their products.

Mr Ojepat also highlighted the fact that the EU and developing countries differ substantially in economic wealth. Indeed, he stated that while European farmers are subsidised by the EU through policy mechanisms and can enjoy a more balanced transition towards a sustainable economy, developing countries cannot provide the same aid to farmers. The speaker took the example of Kenya and specified that the country is still far from reaching food security for its citizens.

Therefore, he stated that the EU should first focus on building relations with third countries and ensure that they become self-sufficient. After this precondition is reached, he stated, it would be possible for them to manage a transition towards a more sustainable production model. As a conclusive remark, Mr Ojepat also called for a science-based approach for policymakers when setting the goals for sustainability.

Moving towards the second part of the debate, the moderator asked Ms Bitterhof if the new strategy on MRLs will include consultations with third countries and if there has been any feedback from them concerning this initiative.

Ms Bitterhof began her reply by clarifying that the 50% target reduction planned in the F2F strategy for pesticide use is only applicable to EU countries and that these targets have not yet been incorporated in a legislative proposal. Any such proposal would require a detailed impact assessment of which the consultation of all stakeholders, including third countries, would be an integral part. The speaker also emphasised that the EU is adopting these new measures in order to encourage other countries to follow the same ambitions in the sector with a gradual approach and that the Commission is currently very active in seeking a constructive dialogue with third countries in this regard.

Within this context, Ms Bitterhof explained that informative session on pesticides for the future of MRLs with third countries have been organised, as well as discussions in multilateral fora and in bilateral contacts with trade partners. She also added that the perspective EU policy changes have received mixed reactions: on the one hand, some commentators agreed that the current climate and environmental challenges require immediate action and, on the other hand, others have raised concerns about developing countries’ economies and societies and argued that these issues should be addressed by taking more into account the ramifications for them.

Continuing on the same topic, the speaker highlighted that the EU is currently trying to foster dialogue and engaging in discussions with every stakeholder in order to find the optimal solutions. Indeed, the holistic approach required to fulfil the sustainability goals will demand the involvement of all stakeholders to find alternatives to damaging substances currently used in agriculture, she added. Ms Bitterhof also pointed out that the EU is ready to engage with third countries that are relying on the use of chemical products to support the transition towards less harmful substances.

The speaker continued by stressing the fact that the progression towards sustainability is not only the result of institutional decisions, but also of the evolution of consumer demand. In fact, consumers’ preferences are shifting towards organic and more sustainable products. This phenomenon, the speaker concluded, might also have impacts on trade practices in the foreseeable future.

Mr Ojepat replied to the comments made by Ms Bitterhof by stating that declaring some substances currently used as hazardous will have several consequences. Firstly, he explained that the withdrawal of certain pesticides will put farmers and producers in a state of uncertainty, as alternative substances may require years to be developed.

Secondly, he highlighted that the reduced range of possibilities will force farmers to rely more on existing products. This will also come with the risk of pests becoming resilient to treatments and hence reducing agricultural output. Thirdly, he said the reduced food output could force some countries to become net food importers. Mr Ojepat further specified that such a situation would be detrimental for developing countries relying on agriculture and could potentially lead to severe economic downturns.

The speaker subsequently explained that finding alternative markets outside the EU is not always possible for developing countries. In fact, establishing new trade agreements would require long negotiations and adapting the supply chain accordingly. These factors could threaten job and food security, with disadvantageous economic consequences.

Ms Bitterhof replied by providing the timeframe of the EU initiatives regarding the use of pesticides. She explained, the general sustainability framework is expected in 2023. The proposal will need to undergo the ordinary legislative procedure, hence under co-decision of the European Parliament and the Council and will be preceded by an impact assessment. Therefore, she clarified that this procedure will require a certain time.

Ms Bitterhof continued by stating that a specific regulation decreasing MRLs for the substances such as clothianidin and thiametoxam, which are of global environmental concern, has not yet been drafted. In fact, the European Commission is reaching out to stakeholders and third countries in order to gather their opinion on the matter and to be able to prepare such a draft regulation. The speaker further reiterated that the draft regulation will be limited to specific harmful substances identified as being of global environmental concern, which can also be substituted by alternative products already available in the market.

She proceeded to clarify that the MRL setting process is based on a risk assessment as required by the MRL Regulation and that this also covers substances falling under the cut-off criteria as mentioned in the F2F Strategy. For the approval of active substances specific rules apply to substances falling under the cut-off criteria and that approval can only be given if the very limited derogations apply.

The moderator changed the focus of the discussion by asking the speakers if the diffusion of sustainable farming practices in developing countries could mitigate the use of pesticides and the impact of the new regulations on the livestock sector.

Ms Boulova started by referring to a previous event organised by FRUCOM on the topic of organic farming outside the EU. She explained that, while organic farming can prove to be a useful tool to increase sustainability in the agricultural sector, it has only a limited capacity. Furthermore, the current capacity of the agricultural sector does not allow for a massive transition towards organic, which will require more time and technological progress to take place.

She also pointed out that, where possible, sustainable and organic methods are being used, however, she added that they are not always the more efficient way to achieve sustainability goals. In conclusion to her speech, Ms Boulova reiterated the importance of having more regulatory predictability, independently from the current state of the initiatives taken in the agri-food sector.

Ms Fernandez emphasised the fact that the livestock sector will be even more regulated in the future. In this regard, she referred to the citizen initiative to “end the cage age”, which is currently being reviewed by the Commission. Such an initiative, she explained, will have an immense impact on livestock management as, for example, currently 50% of the egg production in the EU is based on the cage system. Operating such massive changes in the industry will therefore represent a considerable cost for the industry. Moving to organic production, Ms Fernandez stressed that certain requirements for organic farming are difficult to fulfil, raising the costs of production and delaying the transition towards organic production.

The speaker continued by stressing the fact that further restrictions on phytosanitary products and pesticides will prove too constrictive for the sector, given its high dependency on foreign animal feed products. In addition, she reiterated that imposing new restrictions would not have any considerable impact on food quality and safety, but it would instead substantially raise the costs of production. In the conclusion to her speech, Ms Fernandez urged the Commission to provide an impact assessment for the F2F Strategy to allow the industry to be prepared to transform accordingly.

The remaining part of the debate and the Q&A session covered the following issues: Whether it would be controversial for the EU not to strengthen the rules of MRLs in light of the goals of the Green Deal; how non-tariff trade barriers, such as MRL standards, affect the resilience of the European food supply chain; whether there are sufficient alternatives to the use of pesticides in agricultural production, given the rapid global population growth; the next step forward towards a perfect alignment between consumers’ needs and environmental sustainability; the impact of the ‘green direct payments’ on the reduction of pesticides; the effects of Covid on future initiatives concerning food safety and food security.

Want to know more about the issues discussed in this debate? Then take a look at the selected sources provided below!

A European Green Deal, European Commission

Farm to Fork Strategy, European Commission

Informative session on Pesticides, European Commission

Codex Alimetarius, Food and Agriculture Organisation (FAO)

EU legislation on Maximum Residue Levels, European Commission

Guidelines – Maximum Residue levels, European Commission

Trend in use and risk of chemical and more hazardous pesticides, European Commission

EU agricultural outlook for markets, income and environment, 2020-2030, European Commission

OECD Guidelines for the Testing of Chemicals, Crop Field Trial, OECD

Understanding international harmonization of pesticide maximum residue limits with Codex standards, Food and Agriculture Organisation (FAO)

EU Maximum Residue Level and Import Tolerance Policies, Crop Life Europe

Competitiveness of the EU poultry meat sector, base year 2017: international comparison of production costs, Wagenigen University and Research

International comparison of pig production costs 2018: Results of InterPIG, Wagenigen University and Research