No Origin Labeling for Canada

U.S. backs down on trade dispute, Posted on May 21, 2015 Written by theglobeandmail.com

FA Note: This arti­cle exem­pli­fies the use of inter­na­tional law and trade agree­ments to nul­lify U.S. sov­er­eignty and con­sumer protections.

Fac­ing threat­ened retal­i­a­tion from Canada over “coun­try of ori­gin” meat labelling ruled unlaw­ful by the World Trade Orga­ni­za­tion, the U.S. Con­gress moved quickly on Wednes­day to start to repeal the requirement.

“In light of the World Trade Organization’s deci­sion and the cer­tainty that we face sig­nif­i­cant retal­i­a­tion by Canada and Mex­ico, we can­not afford to delay action,” said Texas Repub­li­can Mike Conaway, chair­man of the House of Rep­re­sen­ta­tives agri­cul­ture committee.

The com­mit­tee over­whelm­ing approved leg­is­la­tion to repeal the labelling, vot­ing 38–6 in favour on Wednes­day and send­ing the mea­sure to the full House of Rep­re­sen­ta­tives. Both Repub­li­cans and Democ­rats backed the repeal.

“It’s an impor­tant first step,” said Den­nis Lay­craft, vice-president of the Cana­dian Cattlemen’s Association.

The labelling rules were intended to pro­tect the U.S. meat indus­try from for­eign com­pe­ti­tion and offer con­sumers more infor­ma­tion about where their food came from. But the manda­tory labels brought added costs to the U.S. meat industry.

“In a recently released con­gres­sion­ally man­dated study, the U.S. Depart­ment of Agri­cul­ture esti­mated it would cost approx­i­mately $2.6-billion for the live­stock and meat indus­try to com­ply with COOL [coun­try of ori­gin labelling] rules,” the House agri­cul­ture com­mit­tee said in back­ground doc­u­ments released ear­lier this week.

Cat­tle born in Canada has to be labelled as such, even if the ani­mals were fat­tened at U.S. feed­lots and slaugh­tered at U.S. facil­i­ties. And U.S.-born cat­tle fat­tened in Canada but slaugh­tered in the United States had to be labelled in a dif­fer­ent way. This meant that U.S. ranch­ers, food mak­ers and oth­ers in the sup­ply chain had to seg­re­gate or mark Cana­dian or Mex­i­can ani­mals from the time they cross the bor­der to the time they hit the super­mar­ket shelves.

For the U.S. beef and pork indus­try, for­eign live­stock became too expen­sive to han­dle. For Cana­dian farm­ers rais­ing cat­tle or pigs, this meant bil­lions in lost sales.

Cana­dian hog pro­duc­ers have lost more than $3-billion in exports and many farm­ers have quit the busi­ness, said Rick Bergmann, chair­man of the Cana­dian Pork Coun­cil. “It’s cre­ated a lot of finan­cial and eco­nomic dam­age as well as per­sonal hard­ship. I can drive you by empty farm­yards because of this,” said Mr. Bergmann, who raises pigs near Stein­bach, Man.

U.S. Agri­cul­ture Sec­re­tary Tom Vil­sack has made it clear that, although he believes that Canada is exag­ger­at­ing the losses its beef indus­try has suf­fered, the U.S. gov­ern­ment has run out of ways to fight for COOL.

How­ever, some U.S. ranch­ers have demanded that Con­gress not give up, claim­ing con­sumers have a right to know where their food comes from.

“When a pop­u­lar, common-sense law like COOL is declared trade ille­gal by an anony­mous tri­bunal of the World Trade Orga­ni­za­tion, you have to won­der what U.S. law is next,” said Gilles Stock­ton, a Mon­tana rancher and a mem­ber of the West­ern Orga­ni­za­tion of Resource Councils.

“We ask that Con­gress make no changes to COOL. … Canada’s claim of dam­ages has been shown to be non-existent by hon­est inde­pen­dent researchers. Con­gress and the Obama admin­is­tra­tion should stand in sol­i­dar­ity with the Amer­i­can peo­ple, and inde­pen­dent cat­tle pro­duc­ers, and not back down.”

But there was bipar­ti­san sup­port to scrap the con­tentious labelling.

“Time and again, manda­tory coun­try of ori­gin labelling is a mis­guided gov­ern­ment pol­icy that has dam­aged our trad­ing rela­tion­ships with Canada and Mex­ico and sub­jected the United States to trade retal­i­a­tions,” said Rep­re­sen­ta­tive Jim Costa, a Cal­i­for­nia Demo­c­rat and the rank­ing mem­ber of the live­stock and for­eign agri­cul­ture subcommittee.

Even if the manda­tory COOL is repealed, there may be an effort to intro­duce vol­un­tary coun­try of ori­gin labels indi­cat­ing cat­tle born, raised and slaugh­tered in the United States.

But “it won’t be a man­dated or manda­tory require­ment,” Mr. Vil­sack said.

The National Cattlemen’s Beef Asso­ci­a­tion, which speaks for 30,000 U.S. ranch­ers, said com­ply­ing with COOL cost beef pro­duc­ers more than $1-billion (U.S.) and led to the clos­ing of slaugh­ter­houses and feedlots.

The group says higher costs asso­ci­ated with labelling have been passed along to its ranch­ers in the form of lower prices for cattle.

“COOL is a vio­la­tion of NAFTA and Canada is one of our biggest trad­ing part­ners, good cat­tle­men like we are, and it is impor­tant to me as a fifth-generation cat­tle­man that we hon­our our trade deals. It is huge, in my mind, that we play by the rules,” said Philip Ellis, pres­i­dent of the asso­ci­a­tion and a rancher in Chug­wa­ter, Wyo.

Cat­tle ranch­ers in Man­i­toba and Saskatchewan were told by their buy­ers in Nebraska that it could no longer take their live­stock. And ranch­ers across the Prairies faced delays at the bor­der and higher trans­porta­tion costs.

“We saw quite a num­ber of U.S. plants that restricted the num­ber of Cana­dian ani­mals at their oper­a­tions … and then most of those oper­a­tions restricted the num­ber of days they would take those ani­mals, so we ended up hav­ing to move ani­mals greater dis­tances to other plant. And then we’d face con­ges­tion at the bor­der and dif­fi­culty lin­ing up the trucks,” said Mr. Lay­craft of the Cana­dian Cattlemen’s Asso­ci­a­tion. “All of those things led to lower prices and sales.”

Gerry Ritz, Cana­dian Min­is­ter of Agri­cul­ture, said Washington’s move to back away from the “wrong-headed pol­icy” was a “step in the right direc­tion.” But he said the only way the U.S. can avoid fac­ing puni­tive tar­iffs on a list of 38 goods that includes meat and wine is to pass the bill and repeal the labelling requirement.

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  Filed Under: Agriculture, New World Order, Trade
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