Canada's Agriculture Minister is hopeful last week's WTO ruling that U.S. Mandatory COOL discriminates against foreign livestock will open the door to a negotiated settlement of the dispute.
Implemented in 2008, Mandatory U.S. Country of Origin Labelling requires American processors to label a range of food products, including beef and pork, according to their country of origin.
In a ruling released Friday the World Trade Organization found the legislation provides imported livestock less favorable treatment than like domestic livestock and is inconsistent with U.S. trade obligations.
Agriculture Minister Gerry Ritz recalls, when the labelling law was implemented, the impact on the Canadian and American livestock industries was immediately negative.
Clip-Gerry Ritz-Canada Minister of Agriculture and Agri-Food:
To comply with the mandatory labelling program the U.S. livestock industry must segregate Canadian animals, process Canadian livestock on a clean separate line and package and label the meat separately.
These additional handling procedures of course mean additional costs which are passed on to producers.
Some processors have simply refused to buy Canadian animals while others are only willing to buy on certain days or at a deeply discounted price.
As you already know this has negatively affected a number of levels of supply, efficiency and operating cost on both sides of the border.
Between 2008 and 2009 exports to the U.S. of Canadian feeder cattle declined a staggering 49 percent.
Exports of slaughter hogs declined an overwhelming 58 percent.
While the vast majority of hurt has been felt in the beef, including veal, and pork sectors the labelling requirement also applies to lamb, chicken, goat and other agricultural commodities.
Ritz says the WTO ruling marks a clear win for Canadian livestock producers and is a vital first step on the road to recovery.
He says a negotiated settlement from this point on is by far the preferred option and stresses Canada remains committed to working with its American allies to create a stronger more profitable livestock industry on both sides of the 49th parallel.