COOL is on life support, By Gerry Ritz

‘COOL is on life support’ – Gerry Ritz

Better Farming

Jim Algie

Feb. 6, 2015

“COOL is on life support,” Canadian Agriculture Minister Gerry Ritz said during an interview from Washington, D. C., Thursday.

Ritz was referring to contentious, U.S. country of origin labelling rules that complicate North American livestock and red meat trade. His comments in a conference call with reporters followed three days of meetings with American legislators and trade officials.

“A growing number of senior people on Capitol Hill are receptive to the message,” Ritz said of long-standing objections from Canada and Mexico. Labelling requirements discriminate against imports and cost Canadian beef and pork business as much as $1 billion annually in discounts and lost sales, Ritz said.

He and Alberta Agriculture Minister Verlyn Olson spoke with reporters during Thursday’s call, and both said they detected a mood shift in Washington. Olson said he was “encouraged by some of the signs that there’s some sober second thought going into the American position.”

Representatives of both the Canadian Cattlemen’s Association and the Canadian Pork Council also participated in this week’s meetings. Pork council vice-chair Bill Wymenga, who farms in Chatham-Kent and returned home late Wednesday from Washington, said in a separate interview he was “pleased with the results.”

However, Wymenga also said it may take yet another World Trade Organization victory and Canadian tariffs on U.S. goods to get Congress to move.

Ritz seemed almost triumphal at points during Thursday’s conference call, expressing confidence in Canada’s position before the pending WTO appeal in Brussels and reasserting plans for tariff retaliation against a variety of U.S. imports to Canada, including beef, pork, orange juice and wine.

“Retaliation is not Canada’s preferred option,” Ritz said. “We would prefer a fair solution to be found outside the WTO process and sooner rather than later,” he said.

The U.S. appeal is scheduled within two weeks. Ritz referred to it as “the final step, strike three as it were,” counting earlier rulings that have gone against the United States. He expects a report on the appeal “at some point in April” leading to publication of the report “sometime in May.”

Canadian delegates met with new Senate and House agriculture committee chairs, Sen. Pat Roberts of Kansas and Rep. Michael Conaway of Texas, and their staffs. Ritz described both chairmen as “strong allies” of COOL reform. Ritz credited Canadian trade officials and Ambassador Gary Dewar with detailed, one-on-one contacts that helped spread the word in Washington.

The message is that by discriminating against imports, labelling laws complicate processing and add needless expense for business on both sides of the border. One major U.S. packer, Tyson Foods, avoids Canadian cattle because of the complications, Ritz said.

“It’s creating huge rifts and tears in the integration of the North American livestock system,” Ritz said. This week’s visit not only coincides with the start of business for the new Republican-led Congress, it also follows an apparent impasse between Congress and the U.S. Department of Agriculture over how to bring U.S. labelling rules into compliance with WTO directives in the event of a lost appeal.

As part of final appropriations legislation in December, Congress directed the USDA to adjust the labelling law for compliance within 15 days of any future appeal or May 1, whichever came first. In widely reported statements in January, however, U.S. Agriculture Secretary Tom Vilsack has said his agency has been unable to find ways to make the labelling laws WTO compliant.

A Jan. 13 report in the Des Moines Register quotes Vilsack to say about COOL that he finds himself “in a rock and a hard spot with Congress telling me to do one thing and the WTO telling me I can’t do what the Congress told me to do.”

The pork council’s Wymenga said it will take an act of Congress to solve the problem.

“It’ll have to come from either the House or the Senate but we feel the only solution is to repeal those sections that are in contravention of what we feel are their WTO obligations,” Wymenga said.

“The question is will there be action before the tariffs are in place or will it take the tariffs to get that done,” he said. “At some point, we hope sometime this year, it will be resolved and that they will repeal that part of the legislation that is causing problems,” Wymenga said.

There is domestic support for Canada’s position among U.S. meat packers and some farm groups. A coalition of 100 groups Ritz called The Barnyard Coalition comprises meat packers and farmers, manufacturers and Chamber of Commerce representation. However, farm opinion also seems divided, judging by continued support for labelling from organizations such as R-Calf (Ranchers Cattlemen Action Legal Fund) and the National Farmers Union.

A recently-published Farmers Union study by Auburn University economist Robert Taylor discredits Canadian data on COOL costs and blames other factors, particularly a decline in demand for high cost meat cuts during the recent recession.

Asked about the Taylor study, Ritz described it as incomplete and “self-serving.” Taylor’s research referred to cattle trade only, ignored hogs, and failed to explain widespread meat industry support for the Canadian position.

“They’ve cobbled together a bunch of numbers that are self-serving in a narrow-cast type of way,” Ritz said. “We sort of shrug our shoulders . . . This is a last gasp attempt as far as I’m concerned,” the agriculture minister said.

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