WTO panel spikes U.S. law on COOL - The Packer

WTO panel spikes U.S. law on COOL

11/28/2011 03:17:00 PM
Tom Karst

(UPDATED COVERAGE, Dec. 1) Sparking calls from U.S. retailers to repeal the law, a World Trade Organization dispute panel has ruled that the U.S. country of origin labeling law is inconsistent with U.S. trade obligations.

The WTO dispute panel — which did not speak to the law’s application to fresh produce — found the U.S. labeling law gives less favorable treatment to Canadian cattle and hogs in comparison with U.S. with domestic livestock and thus violates trade agreements. What’s more, the WTO dispute panel said mandatory country of origin labeling does not fulfill its objective of providing consumers with information on origin.

The Food Marketing Institute issued a statement by the group’s regulatory counsel Erik Lieberman that called for an end to the law.

“The World Trade Organization (WTO) recognized what the supermarket industry has known all along — that COOL is a protectionist law designed to make it more costly and difficult for retailers to sell imported foods,” Lieberman said. “COOL has forced the industry to spend tens millions of dollars each year on unnecessary regulatory burdens all for little or no benefit to consumers.”

Despite high rates of compliance with the law Lieberman said the COOL law has become more of a burden than ever, and makes it challenging for retailers to carry imported produce.

“The COOL law will need to be repealed or rewritten in order for the U.S. to meet its obligations to global trading partners,” Lieberman said in the FMI statement. “We look forward to working with Congress and the U.S. Department of Agriculture to develop an alternative system, onethat will provide useful information to consumers and put our nation in compliance with international trade agreements.”

Dan Sutton, director of produce procurement for Boise, Idaho-based grocer Albertsons LLC, said it doesn’t make sense for the government to spend millions on country of origin labeling enforcement.

“There is a cost of maintaining the program, and when you look at the expense that the U.S. government pays to the state inspectors, they sure spend a lot of money to validate that.”
Sutton said retailers should provide origin information if consumers want it, but he doesn’t see the need for a law that requires the expense of paying for inspectors.

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Roy Ferguson    
Mississauga Ontario Canada  |  November, 29, 2011 at 09:29 AM

From a logistical point of view I could care less where my beef comes from as long as it is processed in a government inspected facility

Florida  |  November, 29, 2011 at 01:58 PM

I can see the difficulties of finding an amenable resolution. For US producers COOL provides an opportunity to have some chance of return on investment. Our producers have made a commitment to high production standards, they have accepted a long term perspective on resource use and management, and they have even made capital investments into research, production, and marketing through the check off program. They have built a notable reputation and deserve a distinct position in their home markets. Consumers want transparency and traceability as part of the solution to their food safety concerns. American consumers are also recognizing the benefits of keeping local dollars local. I know that this sounds like a protectionist or isolationist philosophy, but with our current economic state we need our dollars to bounce around town a little before they become part of our growing trade deficit. Our neighbors who are part consumer and part competition want unhindered access to our infrastructure which our producers and taxpayers have built. Our plants, our interstates, and our inspectors are part of our national resources that also need responsible stewardship. Central and to some extent South America provide opportunities for market expansion within the beef industry through the sale of variety meats and value added end cuts. In trade we provide them a market for discounted higher value cuts. By allowing them to market freely they claim part of the high end sales from US producers. If we don’t allow them this, I have to learn to eat tripe. So be it. I read a report that indicated that Mexican producers were concerned with COOLs effects on their domestic markets. They were concerned that their consumers would show preference for US produced beef. ROI I get it. We need our neighbors to buy our stuff too. I just say we inform our consumers let Canada build a plant or two and see what pure market competition produces. The heck with the WTO.

Nicolas Naranja    
Florida  |  November, 29, 2011 at 09:57 AM

In order to have a perfectly competitive market, the consumer needs to have complete information about the product that they are buying. In the case of produce, I think this would include the who what where when and how it was grown. It really wouldn't be much of a stretch given today's technology to scan a QR code on a bag of lettuce and be able to access GPS coordinates of the field it was harvested from, fertilization history, pesticide records, who harvested it(company name), when it was harvested, when it was packed

Irvine  |  November, 29, 2011 at 10:14 AM

So Nicolas, what kind of a QR code would you put on a green bean?

Sandy Watts    
Vero Beach, Fl  |  November, 29, 2011 at 11:04 AM

I would think that common sense would dictate that the use of country of origin on all exported and imported products woould be pretty much a no-brainer. The whole Product Traceability Incentive issue should be limited to the producer or packing facility. The whole field location and growing history issue is basically redundant and only adds to the growers already high production overhead. The record keeping requirements are excessive and for the most part redundant particularly for fresh produce. The overall safety record of the fresh produce industry is pretty consistant historically, with only a few isolated incidences of contamination or serious threat to consumer health. In general the produce industry has been very responsible in keeping fresh produce safe without a lot of outside rules and regulations, that only serve to drive production costs up.

Bruce DeVilling    
Upland, CA  |  November, 29, 2011 at 11:50 AM

Country of origin is a must to assure food safety and allow for traceability. While green beans are difficult to I'd each one safety and may dictate prepackaging out of US. US

D. Johnson    
California  |  November, 29, 2011 at 01:41 PM

In CA, growers and processors have multiple levels of controls on food safety which is expensive. It is what the consumer wants and it provides some of safest and highest quality product in the world. However, countries like China, and even Mexico do not have to compete on a level playing field. Not only do they use questionable growing practices in many areas but they also use the equivalent of slave labor in many cases. This is why the consumer wants to know where their food is coming from. Our government only tests and inspects less than 1% of the food that comes into this country.

Bart Brighenti    
Australia  |  November, 29, 2011 at 01:49 PM

The fact remains that different countries have different growing standards, levels of tracability and training as well as social standards such as environmental and labour regulations. COOL empowers the consumer with the ability to make a choice of the standards used in the growing of thier food. Supermarkets claim COOL is an extra cost maybe they should look at the extra costs of regulation in western countries compared to developing nations. If we dont have COOL then we need a world wide growing standard or remove all growing standards and tracability and we have our even playing field, but i hope our children are prepared to work all day for a few dollars a day and workers have no workers compensation, superannuation or sick leave.

Florida  |  November, 29, 2011 at 03:26 PM

I’m just trying to read between the lines. Grocers are complaining about higher costs due to COOL. The truth is that COOL isn’t driving up costs its forcing markets to pay for the distinction. Without COOL, US producers compete on a skewed field (higher regulations, same value). With COOL, the field is leveled by consumer awareness and US goods produce stronger sales. Grocers/ consumers like Florida tomatoes but they prefer them at Mexican prices.

Melinda Hemmelgarn    
Columbia, MO  |  November, 30, 2011 at 01:03 AM

I support COOL because I want to know where my food comes from. Consumers have repeatedly expressed that they want MORE transparency in the food system, not less. We also want to know how our food was produced and under what conditions. This partly explains the growing popularity of local farmers' markets, organic and non-GMO verified labels. We are searching for integrity, accountability and quality. As for slave labor, we've got that right here in the good ol' USA. Barry Estrabrook's book, Tomatoland, exposes such conditions in Florida tomato fields. I vote not only for COOL, but for worldwide growing standards as mentioned below that protect farm workers and consumers. On a related note, check out my interview with Michael Carolan, author of The Real Price of Cheap Food on Food Sleuth Radio: www.KOPN.org

montreal  |  December, 06, 2011 at 06:25 AM

Gentlemen, Country of origin makes a whole lot of sense. Period. Enforcing it with a label police is going overboard. Consumers deserve to know. But as a Canadian......it goes both ways. We are the single largest buyer of American grown produce. Larger than all other countries combined. We do export to the US market, albeit in a very small way compared to what we buy down there. While I understand the law, the protectionist angle seems a little tacky from our point of view. We consider American Grown product to be the best available option for our consumers when ours is out of season. We expect the same treatment from our neighbour and largest supplier.

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