There are large differences between the prices of animal products in regions with comparative advantage in livestock production and regions where production costs are higher. In particular, prices for many animal products are much higher in The European Union (EU) and The United States of America (USA) than in regions with extensive grazing areas or low-priced animal feed grains, e.g. Australia, South America and Southern Africa. These price differentials provide strong financial incentives for trade in animal products between these regions. However, trade is constrained by three main factors:

1. 1. The perishability of many animal products, resulting in additional processing costs (e.g. freezing) which may also reduce the value of the product and higher transport costs.

2. 2. The fact that in many markets, high prices have been used as an element of agricultural support policy. These are partly maintained by levies on imported products.

3. 3. Zoosanitary restrictions to control the risk of introducing livestock and human disease agents in animal products.