At first glance, COOL, which stands for country of origin labeling for meat products sold in the U.S., seems like a great idea.
But recently, the U.S. House of Representatives passed a bill to repeal COOL. One of the arguments in favor
of the repeal was that it violated commitments under the World Trade Organization. Many farmers have supported the repeal because of potential retaliatory tariffs.
Jack Klosterman is president of Grass Valley Farm, a fourth generation cattle feeding and ranching operation in
Davis City, Neb. He spoke about the subject of COOL at a recent Nutrition Adventure that I attended, sponsored by the
National Cattlemen’s Association,
“COOL seems like a great idea until you start remembering we are in a world market,” said Klosterman. “When COOL passed, we all got over patriotic, forgetting about Canada and Mexico and how much we trade with them.”
Because of COOL, the U.S. was not in compliance with WTO rules.
“There’s no difference is an animal is finished north or south of the border of Canada,” Klosterman said. “But with COOL changed everything. It became hard to trade feeder cattle with Mexico or Canada. Those markets were gone.”
Soybean trade was also affected. The American Soybean Association supported repeal of COOL because it was concerned about the potential for retaliatory tariffs on U.S. soy exports. In addition, the livestock industry represents the largest consumer of domestically produced soybean meal.
“The WTO has now issued its final and last ruling that COOL unfairly discriminates against livestock from Canada and Mexico, and is incompatible with the way our customers in the livestock industry do business,” said ASA Chairman and Iowa soybean farmer Ray Gaesser. “Canada and Mexico will be able to retaliate by raising tariffs on U.S. meat and other exports to their countries unless we repeal COOL, so repealing COOL is the only sensible thing to do.”
He added, “Failure to do so will impact U.S. meat and other exports to those countries. And let’s be clear, these two countries are critically valuable trading partners.”
Mexico is the United States’ top export customer for U.S. meat products, and Canada is the United States’ third largest customer. In 2014 the United States exported nearly $7 billion worth of U.S. pork, poultry, and beef to these markets, according to the ASA.
The COOL legislation now awaits action by the U.S. Senate.
