Agcanada.com discusses pesticide labels and maximum residue limits and their impact on exporters/importers:
We all know what happened to the Canadian beef industry when BSE was discovered in Canada. Canadian grain producers could face the same consequences if they ignore their customer’s limitations on pesticide residues.
Most countries have set maximum residue limits (MRLs) for pesticides on agricultural products and for unapproved genetically-modified seed. The MRL for malathion on canola seed in Japan is 0.5 parts per million (ppm), for example. As with BSE control measures, these may seem extreme. The health risks of having a sample of canola with one ppm instead of 0.5 ppm of malathion is minute, but 0.5 ppm is the allowable limit Japan has instituted and unless the exporter can provide canola within that MRL, Japan is not interested in purchasing.
The costs of exceeding the MRL for any agricultural product can be huge. First, the sale of the product is lost. Second, all costs of finding a new market or disposing of the product must be borne by the seller. Third, and most costly, future sales of the product are jeopardized. The world grain trade is extremely competitive and other countries are eager to gain a foothold in a new market should another country fail to meet the buyer’s requirements. The Japanese market is our number one export market for canola, importing about $450 million worth of canola a year. It is a market we cannot afford to lose.
This is not just scary talk. Chris Anderson, program manager for the Canola Council of Canada, says Japan has rejected 2 recent shipments because the canola exceeded an MRL. In 2003, a French shipment of canola to Japan was rejected because MRL testing revealed the presence of an unapproved insecticide. Japan refused to take the $6 million shipment and it cost the shipper another $2 million in demurrage, shipping, and handling fees to find an alternative market. French farmers have lost millions more because Japan no longer has the confidence that French canola will meet its standards. Australia has also suffered under Japan’s close scrutiny. Just last year, part of a cargo of Australian canola had levels of fenitrothion insecticide that exceeded Japanese limits and had to be destroyed. The cost to the Australian shippers amounted to $11 million, and all future canola shipments from Australia will be subject to increased testing.
Since “the customer is always right”, it is up to Canadian farmers to make sure the agricultural products we sell do not exceed MRLs of the importing country. It is virtually impossible for a farmer to know the MRL for all pesticides for every importing country. After all, the U.S. regularly tests imported grains for 396 different pesticides. The U.K. conducts tests on foods for 28,000 additives. The only way farmers can prevent accidentally exceeding a pesticide MRL is to strictly follow the pesticide label as per use, timing, and withdrawal period. Canada’s Pest Management Regulatory Agency has tested all pesticides registered for use in Canada and has made sure that by following the label directions, pesticide residues will be below MRLs of importing nations.