Canada-Taking the USA to task.

CANADA-TAKING USA TO TASK.

A major Canadian meat industry group is applauding International Trade Minister Stockwell Day’s announcement earlier this week that Canada is filing a complaint to the World Trade Organization against mandatory country-of-origin (mCOOL) labelling regulations for exported meat products to the United States .

Day told reporters in Washington that Canada would move forward with a WTO consultation on mCOOL in May.

"We’re pleased that the federal government has really stood up for the industry," said Travis Toews, a local beef producer and the vice-president and foreign trade chairman for the Canadian Cattlemen’s Association.

The cross-border row over mCOOL began in October when the U.S. required producers to indicate the country of origin of all beef, poultry, lamb, chicken, fruits, and vegetables.

In the meat industry’s case, for example, any animal born, raised and processed in the U.S. would receive an "A" label; an animal born in Canada, but raised and processed in the U.S. would receive a "B" label; an animal born and raised in Canada but processed in the U.S. would get a "C" label; and another label for ground products, and one for products produced and processed in another country but imported.

In January, the U.S. issued an amended final ruling on country-of-origin labelling that allowed meat packers to integrate both "B" and "C" labels, much to the satisfaction of the CCA.

"That was a real win for the Canadian industry, and that win came about as the Canadian government initially challenged the U.S. at the WTO and requested consultation on the interim final rule," Toews said. "And that has alleviated, to some degree, the effects of country-of-origin labelling on the cattle industry."

But new U.S. Agriculture Secretary, Thomas Vilsack, requested in February that meat packers voluntary adhere to new, stricter regulations that Toews said were more "onerous" than the original ruling. Vilsack indicated that failure to comply would result in the new rules being imposed on them.

"In the cattle industry, that caused a lot of uncertainty amongst processors in the U.S. , amongst cattle feeders in the U.S. (and the Canadian meat industry)," Toews said.

Toews said the country-of-origin labelling rules as a whole have hurt the Canadian industry as it "unfairly" targets Canadian meat products.

Because of the cost associated with separating the various labels, U.S. meat packers have been avoiding importing any meet from Canada , amounting to a loss of $90 per head from October to March, Toews said.

"The segregation requirement is difficult because now the minute you have to segregate cattle, it becomes very costly," he said.

"And the result of that is we lost probably two-thirds of the plants that we used to ship Canadian cattle to in the U.S. "

Meanwhile, Toews said a restructuring in the supply numbers, along with foreign markets like Hong Kong, Saudi Arabia and Jordan lifting restrictions in the last year imposed after the 2003 BSE case, have helped the industry remain viable in the current economic climate.

"The industry as a whole, relative to other sectors of the economy is probably performing reasonably well," he said.

"We have very tight cattle supply numbers, and because of that we’ve seen all classes of cattle move up in price in the last six months, and in some cases quite significantly."