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Canada's beef exports: Border effects and prospects for market access

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  • Pascal L. Ghazalian

Abstract

This paper examines the magnitudes of border effects on Canada's beef exports, and assesses the prospects for market access. The empirical analysis relies on a gravity model derived from a supply‐based framework, and implements different econometric methodologies. It covers the conventional measurement of border effects that is determined relative to the intranational trade baseline. Also, it sets alternative baselines to estimate the wedge between the border effects on beef exports of Canada and those of other countries. The estimated parameters are used to carry out different scenarios to examine the tariff‐related and nontariff border effects, and to evaluate the impacts of trade preferences for Canada's bilateral beef exports. The results reveal significant trade impediments facing Canada's bilateral beef exports to many large markets (e.g., EU‐15, Japan, Republic of Korea, China, and Russia), and they often indicate that the effects of tariff reductions become considerably larger when coupled with reductions in nontariff impediments. Also, they underscore the significance of North American Free Trade Agreement (NAFTA)’s preferential market access for Canada's beef exports. The export opportunities for the Canadian beef industry that are generated through lower trade barriers would, however, decrease when trade barriers facing other beef‐exporting countries are reduced. Ce papier examine l'ampleur des effets frontières sur les exportations canadiennes de bœuf, et évalue les perspectives d'accès au marché. L'analyse empirique repose sur un modèle de gravité dérivé d'un cadre basé sur l'offre, et met en œuvre différentes méthodologies économétriques. Elle couvre la mesure conventionnelle des effets frontières qui est déterminée par rapport à la base de référence du commerce intra‐national. En outre, elle établit d'autres bases de référence pour estimer l’écart entre les effets frontières sur les exportations de bœuf du Canada et ceux des autres pays. Les paramètres estimés sont utilisés pour réaliser différents scénarios afin d'examiner les effets frontières tarifaires et non‐tarifaires, et pour évaluer les impacts des préférences commerciales sur les exportations bilatérales de bœuf du Canada. Les résultats révèlent des obstacles commerciaux importants sur les exportations bilatérales de bœuf du Canada vers de nombreux grands marchés (par exemples, UE‐15, Japon, République de Corée, Chine, et Russie), et ils indiquent souvent que les effets des réductions tarifaires deviennent considérablement plus importants lorsqu'ils s'accompagnent de réductions d'obstacles non‐tarifaires. De plus, ils soulignent l'importance de l'accès préférentiel au marché de l'Accord de Libre‐Échange Nord‐Américain (ALÉNA) pour les exportations canadiennes de bœuf. Les possibilités d'exportation pour l'industrie canadienne du bœuf qui découlent de la réduction des obstacles au commerce diminueraient toutefois lorsque les obstacles au commerce auxquels font face les autres pays exportateurs de bœuf sont réduits.

Suggested Citation

  • Pascal L. Ghazalian, 2019. "Canada's beef exports: Border effects and prospects for market access," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 67(1), pages 53-74, March.
    • Handle: RePEc:bla:canjag:v:67:y:2019:i:1:p:53-74
    DOI: 10.1111/cjag.12173
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    2. Ghazalian, Pascal L. & Mosadegh Sedghy, Bahareh, 2019. "Changes in Canada’s Preferential Trade Network and the Welfare Effects in Agricultural Markets," Estey Centre Journal of International Law and Trade Policy, Estey Centre for Law and Economics in International Trade, vol. 20(1), June.
    3. McDougall, Brendan S. & Afesorgbor, Sylvanus Kwaku, 2020. "The Effect of Free Trade Agreements on the Intensive and Extensive Margins of Canadian Agri-Food Trade," 2020 Annual Meeting, July 26-28, Kansas City, Missouri 304486, Agricultural and Applied Economics Association.
    4. Cordeiro, M.R.C. & Mengistu, G.F. & Pogue, S.J. & Legesse, G. & Gunte, K.E. & Taylor, A.M. & Ominski, K.H. & Beauchemin, K.A. & McGeough, E.J. & Faramarzi, M. & McAllister, T.A., 2022. "Assessing feed security for beef production within livestock-intensive regions," Agricultural Systems, Elsevier, vol. 196(C).

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