Cattle group fears retaliation | NCBA estimates the cost to implement new rules at $100 million
NASHVILLE, Tenn. — The battle against country-of-origin labelling is not lost, says the president of the National Cattlemen’s Beef Association, even if the U.S. farm bill is now law.
“We are going to continue to work on this issue and we are getting more support,” Scott George said in an interview during the NCBA convention held in Nashville Feb. 3-7.
“To me this is just a travesty that Congress didn’t fix this,” said George, who was replaced as president by Bob McCan during the convention but will continue to speak against COOL.
Canada and Mexico have an appeal hearing with the World Trade Organization in Switzerland starting Feb. 18 to decide if the latest version of COOL meets international obligations.
Kristina Butts of the NCBA’s Washington office said the WTO decision could be months away, which gives government time to make changes.
A possible solution is for Congress to refuse to fund its implementation when it is passing spending bills later this spring. COOL cannot continue if there is no budget to pay for inspectors and auditors, Butts said.
“Every day that goes by we are just closer to retaliation,” she said.
“Without addressing COOL, the WTO is going to continue to rule in favour of Canada and Mexico. What that means to you as producers is you are going to suffer retaliations from two of our largest export markets.”
Canada’s list of possible retaliation tariffs includes live animals, beef, baked goods, sugar, biofuel, wine, grapes and apples. Butts said the country needs to start talking about what tariffs might cost.
George is also concerned about added costs to implement the bill because they will likely be passed all the way back to cow-calf producers.
“The potential for this is very scary. The problem is the cost to implement this new rule, according to the Office of Budget and Management, is going to cost over $100 million for our industry,” he said.
“Those packers that are bearing that cost are not going to just eat it. They are going to pass that right back.”
COOL creates added time and paperwork for packers, who must separate foreign animals from domestic ones, and retailers, who must label and separate the meat.
Those added costs are another burden to an already struggling packing industry.
Four major packers process 80 percent of U.S. beef, and individual plants are starting to close. There are not enough cattle, and an inability to add animals from Canada and Mexico will make the situation worse.
The NCBA publicly opposed the farm bill because of COOL, but George admitted the law also contained good news for producers. It has introduced disaster insurance for livestock producers, which may make coverage possible for the past two years because of drought, floods, fire and blizzards.
A research foundation for public and private funders was established, and conservation programs were solidified.