A 2008 United States ruling that discriminates against imported beef may be on the chopping block, and Nicola Valley ranchers are excited.
The World Trade Organization (WTO) has overturned the fourth and final appeal by the United States legislation that makes country of origin labelling (COOL) on meat mandatory.
The international trade regulator decided that the legislation, which has been in effect since 2008, unfairly discriminates against imported beef from Canada and Mexico.
“It’s probably the best news we’ve had for a while,” said John Anderson, president of the Nicola Stockbreeders’ Association, director at the BC Cattlemen’s Association and newly elected board member of the Canadian Cattlemen’s Association.
There’s a bill moving through American government that would repeal the COOL legislation. It has already passed the House of Representatives, but now has to pass the Senate.
“There is some optimism that that might take place within the next couple of months,” said Anderson. “That would be a really big deal for our industry.”
The “country of origin” name for the legislation can sound deceiving.
The real cost to American producers accepting Canadian cattle comes in the segregation of live animals, as well as the products from those animals, from that of domestic ones.
“What happened is most of those plants just chose not to accept Canadian cattle because the cost was higher than it should have been,” explained Dave Solverson, president of the Canadian Cattlemen’s Association.
“Companies that had say six or eight operations across the northern States that were receiving Canadian cattle reduced to one or two.”
Anderson estimated that Canadian cattle were devalued at approximately $100 per head for the added trouble.
That equates to a loss of over $1 billion to Canadian ranchers every year.
For Americans, the cost has been even higher, said Solverson. “The cattlemen in the U.S., they understand that it just costs them,” he said, estimating that it is probably three times the loss south of the border.
The next step is for Canada to institute retaliatory tariffs against the country, something the federal government says they’re willing to do, but would rather not.
“Until we get a fix, the government of Canada has got the foot on the gas, and they are going to go through with retaliation threats,” said Solverson, who said they could start as early as this August against U.S. beef, pork, wine, cherries, pasta, ketchup, cereal, corn, furniture, and other goods.
“It is good news, we may finally have a resolution,” he said.
As far as implications for the local economy go if the law is repealed, both industry leaders said it would take time to get those trade routes reestablished.
“It will still be a slow process, because things have already changed significantly with the way the beef goes through the food chain now,” said Anderson. “We’ve all had to sort of adapt.”
But what’s good for the industry is good for the region, he added.
“I think that we’ll see a bigger, more vigorous, more robust cattle economy, that is going to spread a lot of revenue back out into the Nicola Valley.”
