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Final COOL rule seen improving trade flow

Provisions in the U.S. government’s final rule for mandatory country-of-origin labelling (COOL), published Monday, are expected to help keep cross-border livestock trade flowing.

“These final regulations will help to address the concerns we’ve consistently raised with our American counterparts,” Agriculture Minister Gerry Ritz said in a government release Monday.

Specifically, Ritz and International Trade Minister Stockwell Day said the final COOL regulations will allow for more flexibility on labelling requirements in the U.S. for meat from animals of U.S. and Canadian origin that are brought together during a production run.

Canada has repeatedly raised concerns that COOL could impose unfair costs, especially on Canadian livestock producers, by requiring the segregation of Canadian animals, Day and Ritz said.

The U.S. legislation, which requires food products sold to U.S. consumers to carry labels listing the products’ countries of origin, has been criticized for years by observers as a costly trade barrier dressed as a consumer information tool.

COOL, which has been delayed for years by U.S. lawmakers under lobbying crossfire from farm and ranch groups and food manufacturers, finally came into effect last fall. U.S. meat packers, mindful of the added cost of segregating their production for labels’ sake, have already cut back their use of Canadian- or Mexican-origin livestock.

The analysts who prepare the Chicago Mercantile Exchange’s Daily Livestock Report last week wrote that COOL so far “has been quite effective, if you measure effectiveness by the degree to which it has been able to stifle cattle trade in North America.”

But Ottawa said Monday that the new final rule’s provisions “will help to level the playing field for Canadian producers and will strengthen the integrated North American livestock industry.”

“Together with the provinces and industry, we will continue to assess the trade and market impact of this legislation,” Day said in Monday’s release. “We have built a strong and durable trade relationship over the years with the United States and we must more than ever aggressively pursue this already robust relationship during these difficult economic times.”

The Canadian Pork Council said in a separate release Monday that it’s “cautiously optimistic” regarding the COOL final rule and it hoped that will alleviate market uncertainty and allow the market to stabilize.

But the pork council stressed that it remains opposed to mandatory COOL, seeing it as a barrier to trade.

Canada and Mexico last month took the U.S. to formal consultations under the World Trade Organization regarding the adverse impact of COOL’s interim regulatory measures on livestock and meat producers.

“Canada will continue to monitor the situation and defend Canadian producers through discussions and representations to the U.S. at all levels,” the government said in its release.

“There is an increasing body of market information coming from both the U.S. and Canada pointing clearly to COOL having seriously disrupted trade in live swine between Canada and the U.S. and we continue to have concerns that market discrimination against imports will persist,” said Jurgen Preugschas, president of the Canadian Pork Council, in the group’s release.

But Preugschas, who farms at Mayerthorpe, Alta., added that “publication of the final rule may alleviate some of the market uncertainty that currently disrupts our U.S.-Canada trade relationship.”

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