U.S. food-label rules rejected abroad

For the past nine years, grocery stores in the U.S. have been required to tell shoppers what country produced the meats, fruits and vegetables in their baskets, but the law that requires the labels is buckling under international pressure.

Canada, Mexico and several other countries have complained to the World Trade Organization that country-of-origin labeling (COOL) puts their products at a competitive disadvantage in America -- a practice not allowed under free trade agreements.

Earlier this week, the World Trade Organization ruled in agreement with those countries, saying the law results in less favorable treatment of imported products than domestic products. The United States can appeal the ruling.

Canada has threatened the United States with retaliatory trade barriers if the country chooses not to comply with the ruling, which could include beef, chicken, pork, apples, corn, furniture and alcohol, among other products.

"Canada will be watching this situation closely to ensure U.S. compliance in accordance with the WTO's clear ruling," said Ed Fast, Canada's minister of international trade, and Gerry Ritz, Canada's minister of agriculture and agri-foods, in a statement. "We will continue to fully assert our rights to achieve a fair resolution to our concern, including seeking authorization to implement retaliatory measures on U.S. agricultural and nonagricultural products if and as necessary."

An initiative popular with consumers, but unpopular with the companies that produce and sell the products, country-of-origin labeling has attracted criticism since it was first signed into law in the 2002 farm bill.

A Tyson Foods spokesman declined comment, referring the matter to industry organizations.

The American Meat Institute, which represents meat packers and processors, urged the U.S. Department of Agriculture to amend the law to bring the United States into compliance.

"USDA's mandatory COOL rule is not only onerous and burdensome on livestock producers and meat packers and processors, it does not bring the U.S. into compliance with its WTO obligations," an organization statement read. "By being out of compliance, the U.S. is subject to retaliation from Canada and Mexico that could cost the U.S. economy billions of dollars."

The National Pork Producers Council also urged the federal government to change the law to avoid trade retaliation. The National Cattlemen's Beef Association said the law should be scrapped.

However, the National Farmer's Union has been a chief proponent of the law. Roger Johnson, the organization's president, said meat companies oppose the labeling because it forces them to separate meat and produce from different countries. He said farmers and ranchers support the rule.

"Consumers love COOL because they are concerned -- and rightfully so -- where their food comes from," he said in a statement. "And farmer and ranchers, who raise this nation's livestock and fresh vegetables, love COOL as well, because they're rightfully proud of what they produce. In essence, they want to have their fingerprint on the product."

Business on 10/25/2014

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