Could Revoking a Controversial Pesticide Trigger a Trade War?

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By Tiffany Stecker

The debate over the EPA’s upcoming decision on a controversial crop pesticide has gone global, and some of the U.S.'s top trading partners are raising strong concerns.

The agency is inching closer to a court-ordered deadline on regulating chlorpyrifos, Dow AgroSciences’ widely used pesticide to kill insects on food crops. The Environmental Protection Agency must make a determination by March 31 on whether any amount of chlorpyrifos is safe to use on food.

If the agency decides the chemical is not safe, as it has said in its risk assessments, it would prohibit nearly every food use of chlorpyrifos. Environmental groups have sought to ban the pesticide for more than 20 years, saying that exposure is linked to developmental delays in children.

The pesticides industry and farmers have said it will be difficult to find a replacement for the broad-spectrum bug killer. It also has raised questions abroad, where exporters are asking the agency to consider the impacts on international trade.

Oranges From Brazil

The U.S. is one of Brazil’s biggest market for juice oranges, filling a gap in domestic production as Florida’s orange groves suffer from huanglongbing—better known as citrus greening disease. Brazilian orange growers also are battling the disease, which is spread by the invasive Asian psyllid. Revoking EPA’s limits for the chemical on food crops could put Brazil at a significant trade disadvantage, said Marcel Danilo Nasto de Souza with Citrosuco, Brazil’s orange trade association.

“Chlorpyrifos is an important insecticide choice for our growers, not only because of the rotation practices, but also because of the pest controlling properties this ingredient presents,” de Souza, who handles legislative and regulatory affairs for Citrosuco, wrote in a comment to the agency. “If the substance becomes restricted, it will cause high production losses for the entire citrus chain.”

De Souza told Bloomberg BNA that he heard about the upcoming EPA decision in a news article. He then enlisted Dow AgroSciences, the manufacturer of Lorsban—the trade name for chlorpyrifos—to help sway the EPA.

Brazil is not alone. Officials from Israel, New Zealand, Australia and other countries have weighed in, telling the EPA in regulatory comments that the agency should follow the maximum residue levels (MRLs) for the chemical that appear in the Codex Alimentarus, international standards created to harmonize food safety rules across borders. The Codex limits for chlorpyrifos range from 0.05 milligrams per kilogram of cabbage to 2 milligrams per kilogram of cattle meat.

“The EPA should retain MRLs in line with Codex standards so as to protect both free trade, agriculture, and consumer health,” Carolinn Hjalmroth, director of bilateral trade agreements for Israel’s Ministry of Economy and Industry, said in a letter to the agency.

U.S. ‘Would Clearly Win’ Trade Dispute

Chlorpyrifos is registered in about 100 countries for use on more than 50 crops. An analysis that Down commissioned found that chlorpyrifos is sprayed on 80 percent of Costa Rica’s bananas, 100 percent of Brazil’s citrus and 100 percent of Mexico’s peppers. It also is used in the production of wine grapes in Spain and Italy.

Colin Hunter, the top Australian diplomat for water and agriculture in the U.S., requested that the EPA maintain the current limits for Australian citrus, cattle, goat and sheep meat, given that the average American consumer eats very little of these imports. At 0.5 milligrams per kilogram of meat or citrus, the current Australian limit for the chemical is relatively low, Hunter wrote.

Environmental health advocates said the EPA is not required to loosen its rules to meet the Codex levels. Under the World Trade Organization’s agreement on food safety measures, the EPA could restrict chlorpyrifos in imported produce if it provides scientific justification, said Michael Hansen, a senior staff scientist with the Consumers Union, which advocates for consumer protection laws.

The Codex Alimentarus sets the floor for standards—meaning that countries can be stricter, but not more lax, than the residue levels in the code.

Risk Assessment

If the U.S. were to be challenged, it would have to present a risk assessment to the WTO to justify its decision. The agency’s assessment to date found that no uses of chlorpyrifos met the “reasonable certainty of no harm” safety standard under the Federal Food, Drug, and Cosmetic Act, and laid out the scientific reasoning behind restrictions.

With a scientific report that strongly supports a ban on chlorpyrifos, the U.S. could easily rebuke a WTO challenge from a trade partner.

“I think they would clearly win,” Hansen told Bloomberg BNA.

There are caveats and qualifications, however, for how these deviations should be justified and communicated, Dow said in a statement to Bloomberg BNA. WTO members should take into account the potential damage in terms of loss of production or sales, as well as the relative cost-effectiveness of alternative approaches to limiting risks.

There also are steps that can be taken to address a scientific dispute in trade fora, said Dow. The company has challenged the EPA’s risk assessment, saying it relies on human population studies that the company views as weak.

The WTO’s Sanitary and Phytosanitary Committee, which addresses issues in agricultural trade related to health and safety regulations, is set to meet next month to discuss the chlorpyrifos determination.

Nervous Times

Chlorpyrifos, like other bug killers in the organophosphate family of pesticides, works by inhibiting an enzyme essential for nerve function. In the short term, exposure can cause nausea, dizziness, and in some cases, convulsions or even death.

But environmentalists, supported by population studies performed in the past 20 years, say long-term effects in children are far more problematic, causing brain deformities that can lead to autism, low IQ and other setbacks. The Pesticide Action Network North America and the Natural Resources Defense Council petitioned the EPA in 2007 to stop allowing the use of the pesticide, and sued the agency when it failed to respond. The EPA has asked the U.S. Court of Appeals for the Ninth Circuit several times for more time to make a decision. The EPA issued a notice last November to the WTO to invite comments from its trade partners, but failed to state that an international standard already existed for chlorpyrifos. This ignited questions from Dow AgroSciences, which said the notice was misleading.

Dow Wants Extension

EPA should reopen the 60-day WTO comment period “so that countries misled by the earlier, inaccurate and incomplete notice can thoughtfully consider and respond to the Agency’s proposal,” Dow told Bloomberg BNA in a statement. The EPA declined to comment on Dow’s concerns.

But any extension would push comments past the court-ordered deadline, which won’t be delayed by President Donald Trump’s recent executive order to rescind two existing regulations for every new one. The White House Office of Management and Budget issued interim guidelines Feb. 2 that exempted court-mandated actions from the executive order.

The agency has been evaluating the compound’s health risk for years. If the EPA chose to reverse course now, as some suspect could happen under a business-friendly Trump administration, it would likely prompt immediate legal challenges from environmentalists or a rejection from the federal judges hearing the case.

The EPA said it will consider the comments on the risk assessment and supporting documents before issuing a final tolerance decision.

—With assistance from David Schultz.

To contact the reporter on this story: Tiffany Stecker in Washington, D.C., at tstecker@bna.com

To contact the editor responsible for this story: Larry Pearl at lpearl@bna.com

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