Canada May Retaliate If US Doesn’t Repeal COOL

Date posted - December 17, 2015

Ames, Iowa — The situation regarding labeling of retail meat cuts with their country of origin is changing.
Prime Rib
The Country of Origin Labeling or “COOL” provisions in the 2002 Farm Bill require that retail sellers of certain food commodities inform consumers of a product’s country of origin. While it aimed at keeping American consumers more informed about where their meat came from, Iowa State University Agriculture Economist Lee Schulz says the governments of Canada and Mexico are not in favor of mandatory COOL. He says the World Trade Organization or WTO has ruled that Canada and Mexico should be able to retaliate via over a billion dollars in tarrifs per year to compensate them from losses they suffer due to COOL.

Schulz says a WTO panel set Canada and Mexico’s annual retaliation level at $1.055 billion.

He says Canada and Mexico will probably choose products that would be likely to force Congress to repeal the Country Of Origin Labeling law.

According to Schulz, Canada and Mexico could act as early as the first of the year, and they would be allowed to retaliate at the $1.055 billion per year level until the US repeals the law. Canadian International Trade Minister Chrystia Freeland has said that Canada will retaliate if the U.S. Senate does not take “immediate action” to repeal COOL for beef and pork. The US House passed a bill to repeal the law in June, but the Senate has not yet voted on it.

Schulz says commodity prices are already being affected, and that may or may not translate into retail prices in the longer term.

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