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Friday, 23 March 2012 10:05

CCA disappointed that U.S. Government has filed COOL Appeal at WTO

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The Canadian Cattlemen’s Association (CCA) is disappointed that the U. S. Government has chosen to prolong its discrimination against imported livestock by today requesting that the World Trade Organization (WTO) Appellate Body (AB) review the November 2011 Dispute Settlement Panel decision.

That decision supported Canada’s position that provisions of mandatory Country of Origin Labelling (COOL) discriminate against live cattle and hogs imported into the U.S. from Canada to the detriment of Canadian cattle and hog producers.

COOL continues to have a significant impact on Canadian cattle prices, said CCA President Martin Unrau. 

“There is at least a $25 to $35 per head reduction in price on every head of cattle sold regardless of whether they are exported to the U.S. or not.”

The Dispute Settlement Panel had found that the U.S. is in breach of its WTO obligations because the COOL scheme implemented by the U.S. in 2008 changed the conditions of competition in the U.S. livestock marketplace to the detriment of imported livestock. 

By requiring that all meat, including beef, sold at retail in the U.S. must inform consumers of the birth country of the animal, cattle segregation practices became necessary for U.S. feedlots and packing operations that handle imported livestock. 

These segregation practices and associated costs have created a disincentive for U.S. operations to purchase Canadian cattle.  Those Americans that continue to purchase Canadian cattle do so at a discounted value relative to U.S. born cattle.

Respected agriculture economist Dr. Daniel Sumner has estimated that nearly 9,000 U.S. meatpacking jobs are at risk of being eliminated if COOL is not resolved and the segregation costs remain. 

Moreover, mainstream U.S. cattle and agriculture groups have officially declared their desire that the COOL dispute be resolved and not appealed.

“We had hoped that the U.S. Government would recognize that this law is a drain on the competitiveness of its own meat and livestock sectors” said Unrau. “We don’t need to repeal all of COOL.  We just want a surgical amendment to the legislation that would eliminate the segregation.  That should be a win-win for both Canada and the U.S.”

Even before COOL came into effect, CCA saw the potential negative effects on Canadian cattle producers and made it a high priority to resolve the issue.  Back in 2007, the CCA jointly commissioned the legal analysis along with the Canadian Pork Council that was the basis for Canada requesting the WTO Dispute Settlement Panel.

As the Panel progressed, the CCA participated in the formulation of Canadian positions and coordinated the testimony and data gathering from Canadian cattle producers and U.S. cattle buyers. 

The CCA will continue to support the Government of Canada legal team to ensure the strongest possible defence during the appeal. 

It is expected that written submissions will be made by both countries between now and mid-April.

An oral hearing is expected to take place in late April or early May and a final AB decision would be made before the end of June.

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