International trade in animal products creates complex welfare implications when importing countries have lower welfare standards than exporting ones.
Global animal product trade creates a welfare arbitrage problem: when domestic production faces welfare-improving regulation that increases costs, production may shift to lower-welfare jurisdictions. This pattern has been documented in the EU where welfare improvements in domestic production have coincided with increased imports from lower-welfare sources. Border welfare adjustment mechanisms - requiring imported animal products to meet equivalent welfare standards as domestic production - would prevent this regulatory arbitrage while providing a coherent framework for using trade policy to improve global welfare standards. Political resistance from trading partners and WTO compliance challenges make this difficult but not impossible.