My country is currently debating the prospect of banning live exports of sheep to the Middle East, due to the abhorrent conditions that the animals suffer on the journey over there. Our Agriculture Minister has come out and said "We should tighten regulations instead, because if we ban live exports entirely, then these countries will instead import from other countries with lesser regulations, and there will be no overall reduction in animal suffering."
Does his claim hold up? If other countries have enacted similar bans, what happened afterwards?
I am not aware of any restrictions on live animal exports centered on animal welfare concerns. Concerns about animal disease outbreaks and food safety have primarily led to trade restrictions on live animals, meat, and animal products. A little economic reasoning shows why live animal trade occurs. Trade of live animals primarily consists of three classes—for slaughter, for feeding/finishing, and for breeding. Reasons for live animal exports can be attributed to several factors including relative size and affluence of markets, relative availability of grain supplies and pastures for feeding, location of feedlots (finishing facilities) and closer, more available slaughter facilities. Animal agriculture operates in a commodity marketing system that is highly competitive. Increased prices cause increased production from both domestic and foreign sources—which, in turn, eventually depresses prices. Because of such supply responses, a competitive industry will not experience sustained price levels in excess of long-term average costs (which include a normal rate of return). Therefore, industry participants must continually work at expanding both domestic and foreign markets, developing new products, improving product quality and safety, and lowering production and marketing costs. In a competitive environment, producers who wish to stay in business (and economies that benefit) face incentives to adopt practices that maximize profit, and profit-maximizing outcomes are often not the same as animal welfare-maximizing outcomes. Thus, the real question of interest is not whether profitability must be sacrificed to achieve higher levels of animal welfare, but rather how much.