by MARY BAXTER
Nevertheless, “it is going to hit us,” McConnell warned swine producers attending the Mar. 12 Ontario Pork annual meeting.
Known as COOL (country of origin labeling), the law was first introduced with the 2002 U.S. Farm Bill but was twice postponed because of the need for amendments. The law would require meat, among other products intended for retail sale, to have country of origin labeling if it was raised, slaughtered or processed outside of the U.S.
McConnell said there was a fundamental problem with law first proposed: no provisions were made for how to label products of mixed origin. Itemizing, documenting and certifying every step of the process would have made for “a very messy situation to have to get into that level of labeling,” he said.
Revisions suggested since then simplify the process somewhat but can still mean some onerous paperwork and sorting in the stockyards if Canadian content is involved, McConnell noted. To cope, some U.S. packers may simply eliminate Canadian content. “Others may try to work on some compliance systems,” he said, using as an examples sorting at the plant, timing of shifts and supplying products not intended for the retail market. Still others may demand a discount.
Noting that the newest version of the U.S. Farm Bill has not yet passed, there is still some room for revision of the COOL legislation. There is also a possibility that, with the state of U.S. politics, the bill may fail and the original law proposed in 2002 comes into effect.
More likely, the COOL legislation will be tacked on to another bill if the 2008 Farm Bill fails, he said.
With a sudden and significant reduction of the U.S. market place, then the Canadian industry will probably be looking at an “immediate cull on the isowean feeder side” and more hogs on the Canadian market, McConnell predicted. “Obviously it’s not a good situation.”
Canada’s bargaining power on the issue was limited, he said, recommending efforts should be focused on strategies to make it easier for the U.S. packing industry to include Canadian product. Supplementing production runs and competing on price were other strategies he suggested Canadian producers consider to sustain the packers’ interest.
Although the legislation could certainly be challenged under WTO and NAFTA agreements, McConnell discouraged Ontario producers from considering this route because of the time involved.
Producers can’t rely on litigation to fix this situation, he said. BF