Understanding international harmonization of pesticide Maximum Residue Limits (MRLs) with Codex standards:

A CASE STUDY ON RICESide event of the WTO Committee on Sanitary and Phytosanitary MeasuresNovember 5th 2020

Background For years countries have emphasized the difficulties encountered in the absence of Codex

MRLs for important pesticides used at national level.

Many concerns have been raised also with respect to trade problems linked to differences

in regulatory limits for pesticide residues imposed by different countries.

In 2017, FAO initiated a study to systematically assess the level of harmonization

between countries and Codex pesticide MRLs. The results showed:

a very low level of harmonization

that pesticide MRLs stricter than those recommended by Codex, tended to be applied especially

for commodities such as rice, chili pepper and spices

This highlighted the need to understand better the different dimensions of this

complex issue

Structure of the study (1/2)

PART A: Level of harmonization of rice pesticide MRLs with Codex and impact on trade

Pesticides used on rice and harmonization with Codex MRLs

What does this mean for trade?

Reasons behind different levels of pesticide MRL harmonization

Risk assessment methodology

Risk management considerations

PART B:

Structure of the study (2/2)

Commodity: RICE

• Staple food - plays a significant role in food security

• Developing countries account for more than 96% of global rice production and almost three quarters of global rice exports

• Appeared as subject to national MRLs stricter than Codex MRLs (FAO pre-study)

Countries/region:

1. Australia2. Bangladesh3. Brazil4. Cambodia5. Canada6. China7. European Union8. India9. Indonesia10. Iran 11. Japan12. Myanmar13. Pakistan14. Philippines15. Saudi Arabia16. Thailand17. United Arab Emirates18. United States of America 19. Viet Nam

Data availability constraints:

PART A (economic analysis): 17 economies

PART B (reasons behind): 5 countries/region

Level of harmonization of rice pesticide MRLs with Codex and impact on trade

PART A

Harmonization with Codex rice MRLs

Codex rice MRLs

PART A

Codex code Codex name Total # of MRLs

GC 0649 Rice (defined as “rice with husks that remain attached to kernels even after threshing: kernels with husks”)

25

CM 0649 Rice husked 18

CM 1205 Rice polished 13

GC 0655 Wild rice 1

GC 0080 Cereal grains (rice; wild rice) 25

82

National rice MRLsPART A

263

82 92 11 37

317

486

11965 50

288

82 82 29 62 29 82 99 65 820

50100150200250300350400450500

Tota

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mb

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RLs

National MRLs Codex MRLs

56 82 265 23

57 19 17 34 15 17 82 82

11

56 17 82 39 64

207

66

6 14

260

467

102 31 35

271

18

612

60 1

050

100150200250300350400450500

Tota

l nu

mb

er o

f ri

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RLs

Codex MRLs

01020304050607080

Tota

l nu

mb

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f ri

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RLs

Aligned with Codex Higher than Codex Lower than Codex Codex MRLs but no national MRLs

Harmonization with Codex MRLsPART A

Codex MRLs missing at national levelPART A

Country/region Nat’l MRLs Enforcement procedure followed in the absence of national MRLs

Thailand Yes Defer to Codex

Brazil, Cambodia, Indonesia Yes Defer to Codex

Bangladesh, Myanmar No Defer to Codex

Saudi Arabia Yes Defer to Codex first - then MRLs of the EU or USA

United Arab Emirates No Defer to Codex first - then MRLs of the EU, then default limit at: 0.01 ppm

Pakistan No Defer to the lowest MRL among Codex, EU and USA

European Union, Japan, India

Yes Apply a default limit at: 0.01 ppm

Iran (Islamic Republic of) Yes Apply a default limit at: 0.05 ppm

Canada Yes Apply a default limit at: 0.1 ppm

Australia Yes Apply zero tolerance

United States of America Yes The crop is considered adulterated and may be seized

Philippines Yes Apply zero tolerance

China, Viet Nam Yes Not confirmed – it was assumed that in the absence of an official procedure, zero tolerance applies

PART A

01020304050607080

Tota

l nu

mb

er o

f ri

ce M

RLs

Aligned with Codex Higher than Codex Lower than Codex

Harmonization with Codex MRLs

What does this mean for trade?

Standards can affect trade in two ways

PART A

High consumer awareness of food safety in importing

markets

Standards can be trade-enhancing

More than 50% of the respondents in a household

survey in Georgia (United States of America)

perceived pesticide residues as serious or extremely

serious food safety threat already in the early 2000s

Food safety was identified as the most important

sustainability attribute for rice consumers in Nigeria

in a recent survey

Costs to comply with food safety standards in

export markets

Standards can be trade-impeding

Costs for stricter food safety management

incurred at all levels of the (export) supply

chain

Examples: Investment costs, expenses for

monitoring and certification, daily risk

management

Mixed effects found in the literature

PART A

Study Method Main results

Li and Beghin (2012) Meta-analysis SPS regulations tend to impede exports from developing countries

Santeramo andLamonaca (2019)

Meta-analysis Stricter MRLs tend to favour trade

Chen et al. (2008) Gravity model MRLs on the insecticide chlorpyrifos reduce China’s exports of vegetables

Melo et al. (2014) Gravity model MRLs reduce Chile’s exports of fresh fruits

Kareem et al. (2018) Gravity model EU MRLs on tomatoes reduce exports from African countriesEU MRLs on citrus fruits enhance exports from African countries

Drogué and DeMaria(2012)

Gravity model Increasing the similarity of MRLs among countries increases trade of apples and pears

Winchester et al. (2012) Gravity model Stricter pesticide MRLs for plant products in onecountry relative to other countries reduce exports to that country

Xiong and Beghin (2014) Gravity model Pesticide MRLs by OECD countries are associated with more trade; divergence of regulations between importer and exporter impedes trade

PART AAverage MRLs on rice by importer/exporter

0.0

1.0

2.0

3.0

Australia Canada China EuropeanUnion

Indonesia Japan Saudi Arabia UnitedStates ofAmerica

MR

L in

dex

Rice in the husk Husked (brown) rice Rice, semi-milled or wholly milled Rice, broken

0.0

0.5

1.0

1.5

2.0

2.5

3.0

MR

L in

dex

Importers: Average MRLs tend to be stricter than Codex

Exporters: Average MRLs aligned with Codex in 50% of the cases

PART AEffects on trade in rice

-1.0-0.50.00.51.01.52.0

MRL Importer MRL Divergence

Effe

ct o

n t

rad

e

Likelihood to trade Intensity of trade

Importers: Stricter MRLs are

associated with relatively more rice

imports, possibly reflecting strong

consumer awareness of food safety

Exporters: Stricter MRLs of the

importer relative to those of the

exporter are associated with

additional costs and may impede

exports

Many other factors that influence

trade between two countries

Likelihood to trade Intensity of trade

Production of exporter + +

Trade in 1995 + +

Rice variety + +

Colonial relationship +

Tariff of importer - -

Distance - -

Development status - -

Reasons behind different levels of pesticide MRL harmonization

PART B

Reasons behind different levels of harmonization

In collaboration with the JMPR Secretariat, key issues that could lead to divergent

decisions concerning MRLs have been identified :

1) Differences in risk assessment processes

2) Differences in risk management policy/decisions

Interested countries/region were approached to gather their views.

This analysis focuses only on five countries/region: Australia, Canada, the European

Union, Japan and the United States of America

PART B

There is considerable variation in how countries are aligned with the JMPR and Codex process for the

development and establishment of pesticide MRLs.

Many of the observed differences in risk assessments do not seem to have a significant impact on the

overall outcome of the pesticide safety evaluations.

Some of the major differences in MRLs and residue definitions are due to the presentation of different

data to the various countries/region.

Harmonization also depends on national authorities supplying updated consumption data to FAO/WHO,

via the GEMS and CIFOCOss databases.

Many of the guidance/procedural documents related to MRLs and human health risk assessments of

pesticides were initially drafted 10 to 20 years ago. Consideration could be given to an update process that

can be agreed internationally.

PART B

Risk Assessment methodologyFindings

Automatic harmonization with Codex MRLs is not the norm. For non-registered MRLs, common practices are to set a default value (usually at the limit of quantification) or to not establish any tolerance/MRL.

In the absence of a national MRL, an application can be made to have an MRL established, which is termed an import tolerance.

During the Codex step-process, active notification whenever a Codex MRL is not going to be adopted and the scientific rationale for that decision is only rarely provided.

Differences in the time of MRL adoption at Codex and at national level may entail changes in the scientific data packages evaluated by the different authorities.

There is great inconsistency among the commodity descriptions across different countries.

PART B

Risk Management considerationsFindings

Conclusions and recommendations (1/2)

Lack of Codex MRLs: addressing the need for more Codex MRLs should be further considered.

Missing national MRLs: deferral to Codex MRLs when national MRLs do not exist could be considered as

a default practice, as also recommended by the SPS Agreement: “the importing Member shall consider

the use of a relevant international standard as the basis for access until a final determination is made”.

Food classification: consistency could be improved to reduce the potential confusion over multiple MRLs

for different forms of a single pesticide/crop combination.

Improving harmonization: critical areas such as residue definitions, classification, etc. need to be further

considered.

PART A PART B

Conclusions and recommendations (2/2)Transparency: it would be important that countries actively notify Codex whenever they have any reservation and are not in the position to adopt a newly established Codex MRL, providing a science-based rationale.

Capacity development: consideration should be given to developing countries’ needs for better and more active participation in the Codex standard-setting process and to the needs of those countries when developing new MRLs.

Dual effect of MRLs on trade:

Balance between high food safety requirements on the importing side and the higher market access costs incurred by exporting countries

Increase developing countries’ capacity to comply with food safety standards in both their export and domestic supply chains

PART A PART B

Thank you!