EU Pesticide Rules Could Push Up Coffee Prices

Stricter EU limits on pesticide residues in imported food could push up the price of coffee and other agricultural products, although the scale of the impact would depend heavily on how exporters adapt to the new rules.

The European Commission wants to reduce permitted residues of some of the most hazardous pesticides in food imported from outside the bloc to the lowest level that laboratories can reliably detect. The aim is to ensure that foreign producers are not allowed to use substances subject to stricter rules within the EU.

A study by the European Commission's Joint Research Centre examined the potential impact of restrictions covering 18 active substances, 235 agricultural products and imports from 86 countries.

Under the study's most extreme scenario, which assumes exporters make no adjustments in response to the rules, EU agricultural imports could fall by 41%. Coffee prices could rise by as much as 332%, while citrus fruit prices could increase by 85% and oilseed meal by 87%. The researchers stress, however, that this represents an extreme scenario rather than a forecast.

Under an intermediate scenario, imports would decline by around 8%, while prices for coffee, soybeans, and citrus fruits would rise by approximately 6%. In the mildest scenario, the overall impact would be around 1%.

The proposed changes have yet to be approved. The United States, Canada, Brazil, Argentina, Paraguay and Australia are among the countries that have raised or supported concerns about the measures at the World Trade Organization.

European Parliament committees are expected to consider the proposal this fall.

(Politico, bak)