The spectre of mandatory country-of-origin labelling in the United States has raised its ugly head again.
That’s how Canadian livestock producers view a recent social media effort in the U.S. with the Twitter handle of #faircattlemarkets.
The suggestion by some American cattle groups that COOL be reinstated is only one part of a campaign critical of high packer profit margins, lower returns to producers and consolidation in the meat packing industry.
An Oct. 2 rally in Omaha, Nebraska, dubbed “Stop the Stealin’” attracted an estimated 400 cattle producers and feeders from several states. They heard a list of actions that the Organization for Competitive Markets, sponsor of the rally, wants the American government to implement.
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They include a reduction in the foreign beef imported to the U.S. and withdrawal from the new U.S.-Mexico-Canada Agreement on trade until COOL is included in the agreement. They also want to halt the labelling of meat as Product of the USA if it originates in another country and is then further packaged or processed in the U.S.
The Canadian Cattlemen’s Association is watching developments, said CCA general manager David Moss.
“We are certainly monitoring it from afar. It is mostly a U.S. issue but when it gets air time, that’s our job is to monitor those things.”
U.S.-imposed COOL was implemented in 2010 and caused millions of dollars in Canadian livestock losses. The need to segregate meat from imported Canadian cattle and pigs discouraged U.S. packers from buying Canadian animals due to the higher costs involved.
Canada and Mexico successfully challenged COOL at the World Trade Organization and won their case in 2015. That leads the CCA to believe reinstatement of COOL is a non-starter.
“We’d like to believe not,” Moss said of a potential inclusion of COOL in the USMCA. “The fact that we won the WTO ruling in 2015 certainly puts in our minds that that’s something that should be put to bed and no longer on the table. We reserve the right, if they were to implement that, that we have a $1 billion retaliatory right to implement tariffs immediately if they were to put that back on the table.”
Factions behind the Fair Cattle Markets movement connect improved producer profits seen in 2014-15 with COOL but Moss said supply and demand fundamentals at that time caused the feeder cattle price spike and were unrelated to mandatory labelling.
The CCA explained that in a recent newsletter.
“From 2010 to 2015, U.S. beef production dropped 10% (and) mCOOL came into effect in 2010. This decline in supplies, along with strong domestic and international demand, combined with the PED virus, which saw U.S. pork production drop, all led to the spike in cattle/beef prices into 2014 and 2015,” the CCA said.
American producers responded to higher prices, added Moss.
“Since 2015 the U.S. read those demand signals very clearly and increased production by about 14 percent so now you’re starting to see that supply-demand ratio shifting. That’s why you’re starting to see some of the profitability come out of that market.”
An August fire at the Tyson beef processing plant in Holcomb, Kansas, exacerbated recent U.S. cattle producer concerns. That plant processed about four percent of total slaughter cattle and has yet to be back in production.
Resulting market volatility is another reason for the Fair Cattle Markets movement. However, Moss said other packers have added shifts to compensate and are willing to do so given their rosy profit picture.
“We’re seeing year over year slaughter numbers are slightly higher in the U.S. than they were last year, so overall the impact has been minimal,” Moss said.
Officials with the National Cattlemen’s Beef Association have been critical of the Fair Cattle Markets campaign, particularly after investigations revealed a connection between its founders, the Organization for Competitive Markets, and the Humane Society of the United States. The latter organization has a stated goal of eliminating animal agriculture.
The NCBA did not respond to queries by press time.
Moss said the HSUS connection has harmed the credibility of the Fair Cattle Markets campaign in his view and that of the NCBA.
“It makes for odd bedfellows when you have different organizations like that aligning with fringe R-CALF type groups.”
R-CALF USA, the Ranchers-Cattlemen Action Legal Fund United Stockgrowers of America, is a group of independent cattle producers that have a goal, among others, of reinstating COOL.
