Since the U.S. country-of-origin labeling law went into effect a month ago, more meat plants in the U.S. are just saying “no” to Canadian hogs and cattle for processing. The Canadian pork council said that some U.S. hog processing companies have said they will not purchase hogs born outside of the States. Other U.S. processors have said they will only buy Canadian pigs on certain days at selected plants.
With new country-of-origin labelling laws shutting Canadian hogs and cattle out of American markets, a growing number of Canadian producers are seeking trade actions.
The Canadian Cattlemen's Association and the Canadian Pork Council are asking their government to challenge the U.S. law under rules of the North American free-trade agreement. They warn that the COOL law will drive some Canadian producers out of business, reduce livestock herds and cost the two industries $800 million per year.
“They need to initiate a trade challenge against the U.S.,” said John Masswohl of the CCA. He added that producers are concerned the law could be made even more troublesome to Canadian livestock producers if U.S. voters send more trade-protectionist politicians to Washington in Tuesday’s elections.
Under COOL, Canadian animals are required to have documentation about their origin, and in the case of cattle, the animals must have identification tags that indicate they are mad cow disease-free. In addition, Canadian livestock must be segregated in U.S. feedlots and packing plants which increases the investment and digs into already narrow profit margins.
The Canadian pork industry may lose about $350-million a year if the law remains in effect without revisions. The presidents of both the CCA and the CPC have urged the Canadian government to take action. Together the two groups represent about 100,000 producers.
Agriculture Minister Gerry Ritz said Ottawa wants to influence U.S. COOL laws by working with the American lawmakers and industry. “I would caution that if the federal government is taking the view that it must have concrete evidence of the adverse impact of COOL before approaching the U.S., very valuable time will be lost and any solution could come too late for the Canadian swine industry.”
The cattlemen's association says some corporations, including Tyson, are already refusing Canadian cattle and that others such as Cargill may only slaughter Canadian cattle on certain days.
CCA president Brad Wildeman, who runs a feedlot near Lanigan Sask., was even more emphatic in his letter to the prime minister. “Our preliminary estimate is that COOL is reducing the value of Canadian cattle at a rate approaching $500-million per year. We fear that the next U.S. administration may further tighten the procedures,” he wrote. “The worst has likely not yet been seen and we anticipate the costs could grow further. Therefore, we urge you to initiate a trade challenge immediately to seek repeal of this egregious U.S. law.”
Ritz suggested if that isn't successful, Ottawa would consider launching a trade challenge.
“We have made it clear to the United States that we will consider all our options, including actions under both the North American Free Trade Agreement and World Trade Organization provisions, but right now we have a window of opportunity to influence the COOL regulations before they become final and we are focused on that,” Ritz said.
The U.S. COOL law that took effect on October 1st is called an interim final rule. The final rule is expected to be passed next year.