USDA’s Agricultural Marketing Service today issued a Final Rule to modify the labeling provisions for the mandatory Country of Origin Labeling (COOL) program. The new rule requires meat be labeled with source information for each production step – born, raised and slaughtered.  The rule can be found online at http://www.ams.usda.gov/AMSv1.0/COOL.

North American Meat Association CEO Barry Carpenter called the rule a “disaster.”

“It will exacerbate costs, particularly for independent packers that need to comingle animals to run their plants near capacity. With the other factors impacting their business, some may not be able to continue to operate,” said Carpenter. “And it won’t appease those World Trade Organization concerns brought by Canada and Mexico that forced this regulatory initiative.”

“It is incomprehensible that USDA would finalize a controversial rule that stands to harm American agriculture, when comments on the proposal made clear how deeply and negatively it will impact U.S. meat companies and livestock producers.  This rubber stamping of the proposal begs the question of the integrity of the process:  many people spoke, but no one at USDA listened,” said AMI Senior Vice President of Regulatory Affairs and General Counsel Mark Dopp. “The decision to proceed with a rule that is more costly, complex and burdensome than the earlier version,  when WTO and our trading partners have sent strong signals that this is no ‘fix,’ shows a reckless disregard for trade relations and for companies whose very survival is at risk because they rely upon imported livestock.” 

“If it wasn’t obvious previously that politics were driving USDA’s COOL rule, it is painfully clear now,” Dopp added.

The WTO said last year that the 2009 U.S country of origin rule discriminated against livestock from Canada and Mexico. Washington had until Thursday to ensure the labeling rule complied with trade obligations.

Agriculture Minister Gerry Ritz and Trade Minister Ed Fast said in a joint statement that rule means additional costs for producers on both sides of the border and increased damage to the industry, reports ABC News. They argued that the revisions to COOL do not fix any of the label rule’s past problems.

"Canada will consider all options at its disposal, including, if necessary, the use of retaliatory measures," the statement said.

Mexico's Agriculture Minister Enrique Martinez said the labeling rule was hurting local industry, reports Reuters.

"We have talked with beef producers in the United States and Canada, and totally agree this is an arbitrary decision and means discrimination against Mexican beef, which we will never agree with and as a government will defend against,” he said. The government did not issue a statement about whether it would join Canada in pursuing retaliatory tariffs against U.S. products.

National Cattlemen’s Beef Association President Scott George, a Cody, Wyo. dairy and cattle producer, issued a statement expressing his disappointment with the final rule. He noted the final provisions will not bring the U.S. into compliance with the WTO obligations and could result in tariffs against U.S. products. He also objected to the use of the word “harvested” on meat labels, calling it unappealing to the NCBA and consumers alike.

“As cattlemen and women, we do not oppose voluntary labeling as a marketing tool to distinguish product and add value. However, USDA is not the entity that we want marketing beef,” he said. “Moreover, this rule will place a greater record-keeping burden on producers, feeders and processors through the born, raised and harvested label.”

Aside from the USDA itself, the only organization that released a statement in support of COOL was R-CALF, which said it was pleased with the final rule. The organization noted that by providing specific information on each step of the process, the new labels satisfy WTO complaints.

“USDA’s final rule is right on the mark,” said R-CALF USA COOL Committee Chair Mike Schultz adding, “We are pleased that USDA did not weakened COOL in response to the WTO’s attack on our domestic food labeling program.”

R-CALF USA CEO Bill Bullard explained that COOL is necessary to facilitate competition for U.S. cattle and provide choices for U.S. consumers.

“Without COOL it is the meatpacker and not the consumer that decides from what country cattle will be sourced to satisfy consumer demand for beef.  Only with COOL can consumers trigger a demand signal for cattle sourced from U.S. farmers and ranchers, which they can do simply by consistently choosing to purchase a USA product,” concluded Bullard.

Sources: NAMA, AMI, R-CALF, NCBA, ABC News, Reuters