The governments of both Canada and Mexico have requested the establishment of a “compliance panel” in order to confirm that the United States has failed to fulfill its obligations under the World Trade Organization (WTO) ruling on Mandatory Country of Origin Labeling (COOL). In May, the U.S. Department of Agriculture (USDA) issued a final rule regarding COOL. The rule requires that all products sold at retail be labeled with information noting the birth, raising and harvest of the animal, along with the elimination of the ability to commingle muscle cuts. This new rule will potentially cost between $53 million to $138 million, to implement, although the extra costs could reach $192 million.
“We have expected this move by Canada and Mexico for quite some time because we have known that they were not satisfied with the final COOL rule that was issued by the U.S. as an attempt comply with the WTO ruling,” said National Cattlemen’s Beef Association (NCBA) Vice President of Government Affairs Colin Woodall. “This launches the next phase of the WTO process where they will consult with Canada and Mexico and U.S. to determine whether or not the May rule actually satisfies what they want in terms of compliance.”
Woodall added that if the violation is confirmed by the compliance panel, Mexico and Canada will be in a position to impose trade retaliation actions against the United States. NCBA disagrees with the USDA final COOL rule, calling the agency’s action “short-sighted.”
“As cattlemen and women, we do not oppose voluntary labeling as a marketing tool to distinguish product and add value,” Woodall said. “However, USDA is not the entity that we want marketing beef.”