Watching its rules be reinterpreted on “a weekly basis,” Canada’s cattle and hog producers say U.S. country-of-origin labelling (COOL) legislation is now chilling cross-border trade volume and prices.
The Canadian Cattlemen’s Association and Canadian Pork Council have filed joint comments with the U.S. Department of Agriculture (USDA) saying COOL is discriminating against Canada’s 100,000 livestock producers, the cattle and hog farmers’ groups said Tuesday.
“The law seems to be open to interpretation on a weekly basis, depending on comments and questions submitted to the USDA,” said Travis Toews, the CCA’s foreign trade committee chair, in a joint release Tuesday.
“The constantly changing regulatory landscape is creating confusion among producers and packers. We have already seen disruption occurring in the markets and expect more negative impact on volume and prices, as some traders adopt a ‘wait-and-see’ approach to Canadian cattle markets.”
Furthermore, COOL violates World Trade Organization (WTO) rules and has caused a “high degree of uncertainty” over the extent of its impact, Toews said.
WTO panel planned
The two groups noted federal Agriculture Minister Gerry Ritz announced during a recent debate that he plans to initiate a WTO panel against COOL.
To that end, “tangible evidence will be required to develop the legal and political case, so we are asking producers and processors to document any impact they experience as a result of COOL,” Toews said, noting the two groups will continue to press the Canadian government to take WTO action.
The two groups don’t expect to see a “single sudden market shift” due to COOL, but the increased cost of record-keeping for producers and processors, plus expenses incurred by animal segregation in processing plants, will eventually show in the market, Toews said.
“Already, one of our major U.S. customers announced they will cease purchasing pigs born outside of the U.S. when COOL enforcement begins,” CPC president Jurgen Preugschas said in the same release. “The industries in both countries stand to lose economic opportunities.”
“Consumers don’t want to pay more for their food, so the additional cost must be absorbed somewhere,” Toews said. “The American meat processing industry anticipates the $3.9 billion price tag for instituting this practice is only the beginning of increased costs to the industry.”
Citing COOL’s “obvious flaws,” the two Canadian groups said labelling of processed food “unfairly targets ground meat, hamburger and patties,” which makes it a concern for U.S. retailers and processors as well.
“We believe that meat which undergoes further processing in a U.S. facility, whether ground or combined with other ingredients, should no longer be called Canadian,” Toews said.
“Also, the potential for inconsistencies within the paper trail exists, as it applies to domestic or imported animals, including animal identification requirements.”