On May 18, the World Trade Organization (WTO) published its fourth and final ruling on the United States’ Country of Origin Labeling (COOL) measures for beef and pork. Once again, the verdict was clear: these measures are being implemented in a discriminatory manner, and as a result the U.S. is in violation of their international trade obligations under the WTO. Because this was the final WTO ruling and the United States continues to avoid action, Canada will now seek authorization from the WTO to impose over $3 billion in retaliatory measures against U.S. exports to Canada.
Why specifically should this matter to Americans in the Northwest? Given the immensely successful trading relationship between our countries, Canada’s retaliatory tariffs could have a significant effect on a wide range of U.S. and Idaho exports, including potato products, milk proteins, beef and chocolate. These exports will be targeted to maximize impacts on the U.S., while minimizing impacts on Canada. However, Canada’s preference is that the U.S. brings COOL into compliance with its trade obligations and avoids retaliation.
Let’s agree up front on one fact about COOL: it’s not about food safety. The U.S. Department of Agriculture has confirmed this. Canada’s long-standing position on COOL has been that the measures for beef and pork serve protectionist objectives above all other stated objectives and result in discrimination against Canada, the largest trading partner of the U.S. We are not alone in our position. This policy has hurt a number of American businesses, processing plant workers and ultimately consumers.
A 2015 study contracted by the U.S. Department of Agriculture has estimated that over a cumulative 10-year period COOL has led to losses of more than $8.5 billion to the U.S. beef industry and $1.7 billion to the U.S. pork industry. An estimated 6,000 American jobs have already been lost due to plant closures associated with COOL. And there could be more bad news for the American economy if Canada is forced to retaliate.
Canada is the number one customer for 35 U.S. states — including Idaho. Canadians bought $1 billion in U.S. beef and $900 million in U.S. pork last year alone, and we are an important partner in the value chain for all kinds of crops, products, and services for producers across Idaho.
For many years, American feedlots and processing plants have imported live animals from Canada, raising and processing them in the United States. This trade in livestock has helped American plants run at full capacity, which has supported jobs, families, and communities on both sides of the border. COOL, by requiring the segregation of livestock and meat at each step of the supply chain has damaged these operations by imposing additional costs on farmers, ranchers and consumers. In the process, it has damaged the integrated supply chain that agriculture and countless other industries depend on for our mutual prosperity.
So what comes next? As Canada proceeds with the final steps in the WTO process it is hoped that a legislative change to fully repeal COOL’s provisions for beef and pork will be supported by U.S. lawmakers.
Two weeks ago, members of Congress in the House moved swiftly to introduce the bipartisan bill HR2393 to repeal COOL for beef, pork and poultry, which is a welcome step forward. If enacted into law, the bill would resolve COOL and bring about U.S. trade compliance, the integrated and highly successful North American livestock sector would be restored, and producers and processors on both sides of the border would benefit as a result.
U.S. COOL for beef and pork is undermining our shared North America prosperity. After seven years of fighting, it is time for the U.S. to respect the views of businesses and workers and end this harmful policy.
James K. Hill is Consul General of Canada in Seattle.