U.S. manufacturers and foodmakers are pressing lawmakers for speedy repeal of the U.S. law that requires labels on packages of beef, pork, lamb and poultry meat to say where the animals were born, raised and slaughtered. So-called country of origin labeling (COOL) has been under challenge since December 2008 at the World Trade Organization, which has promised a final ruling on the matter by today. The United States lost three previous rulings and was expected to lose this one as well. WTO says COOL distorts trade by discouraging imports of livestock from Canada and Mexico.
Ahead of a formal WTO announcement, Reuters cited a government official as saying the United States lost the case.
House Agriculture chairman Michael Conaway says his committee “is prepared to lead” on repeal of COOL as a “failed experiment” that cannot be fixed. The COOL Reform Coalitionof farm and industry groups wrote senators at the close of last week to say that, with the House on track to repeal COOL, “We are anxious that the Senate be well-prepared to act on that legislation before the August recess.”
As impetus for repeal, the anti-COOL coalition, which includes the National Association of Manufacturers and the U.S. Chamber of Commerce, points to the possibility that Canada and Mexico will impose billions of dollars in retaliatory tariffs on U.S. food, agricultural and manufactured goods to offset damage to their livestock industries. “This calendar and previous experience indicates that WTO-authorized retaliatory tariffs could be imposed as early as late summer,” said the coalition letter, warning that some exports sales will evaporate as soon as the WTO decision is announced.
An adverse ruling would present the best chance yet for critics to win repeal of COOL.
Foodmakers and the largest groups representing U.S. cattle and hog producers opposed COOL from the start as an expensive, bookkeeping headache. It is supported by U.S. consumer groups and the two largest U.S. farm groups as a matter of consumers’ right to know. During negotiations over the 2014 farm law, the Republican-controlled House tried to eliminate COOL but was thwarted by the Senate, then in Democratic hands.
The National Farmers Union has argued against a rush to repeal COOL when the case still can be taken to arbitration, where Canada and Mexico could be forced to prove the scope of damage from COOL. NFU says the 2008-09 recession and slow economic recovery are the true causes of a downturn in livestock trade. In a blog, the House Agriculture Committee says Canada and Mexico put their losses from COOL at $2 billion – “The U.S. may seek arbitration in an attempt to lessen this figure, but businesses relying on long term supply contracts are already feeling the pinch of retaliation brought about by uncertainty in the market place.”
Conaway told Agri-Pulse he is prepared to ask a committee vote on legislation to repeal COOL as early as this week. Senate Agriculture chairman Pat Roberts “hasn’t committed to trying to repeal the law,” says Agri-Pulse, although he says he will consider any option to comply with world trade rules and avoid trade retaliation.