Canadian Agriculture Minister Gerry Ritz said Canada is prepared to impose sanctions of up to $980 million a year against the US in retaliation for US country-of-origin labeling regulations. Ritz spent some time on his recent trade mission to the United States making clear his country's displeasure with the US COOL program.
Ritz met with US Agriculture Secretary Tom Vilsack to express Canada's disappointment at proposed changes to US COOL regulations. In March, the US Department of Agriculture's Agriculture Marketing Service issued a proposed rule that would modify labeling provisions for muscle cuts covered under the COOL program. Under the proposed revisions, origin designations would include information about where each production step occurred and would remove the allowance for commingling of muscle cuts. The rule also would amend the definition for "retailer".
Canada and some US meat and poultry industry groups were critical of the proposed changes, arguing that the changes would not bring the US COOL program into compliance with World Trade Organization obligation. The US lost an appeal of a WTO challenge brought by Canada and Mexico in 2012. The WTO Appellate Body said US mandatory COOL regulations violated trade agreements by giving less favorable treatment to Canadian cattle and hogs compared to domestic livestock.
Ritz emphasized that the proposed changes will not bring the US into compliance with its WTO obligations and will increase discrimination against exports of cattle and hogs from Canada, increasing damages to the Canadian industry.
"Our government is focused on ensuring that Canadian producers will be able to gain and maintain broader access to diverse markets, to bolster the Canadian economy,” Ritz said. “COOL continues to have a negative economic impact on the Canadian livestock industry and we are standing with Canadian cattle and hog producers against unfair mandatory Country-of-Origin Labeling in the US.
“Our government will consider all options, including extensive retaliatory measures, should the US not achieve compliance by May 23, 2013, as mandated by the WTO.”
Ritz also met with US Senate Agriculture Committee members and other congressional representatives, to convey Canada's intentions to protect Canadian cattle and hog producers against mandatory COOL. He also met with the American Meat Institute and livestock industry stakeholders who are advocating for changes to the US COOL program.
"As each other's largest trading partners, we need to work together to ensure trade is contributing to the productivity and competitiveness of the sector for the benefit of our farmers," Ritz said. "The flow of cross-border trade is essential to our economic growth."
