COOL Implementation: The First Six Weeks

November 21, 2008 - Six weeks after mandatory country-of-origin labeling (COOL) went into effect in the United States, analysts say the rules are resulting in fewer Canadian hog imports and forcing beef packers to segregate plants and shifts to minimize labeling costs.

Five of the top 10 pork processors will not buy pigs from Canada. Of the remaining five, only one has said it plans to slaughter Canadian market hogs, according to livestock analyst Steve Meyer, president of Paragon Economics.

"Currently, there is a lot of interest on the part of U.S. finishers in securing sources of U.S.-born pigs," wrote Meyer. "That has understandably put negative pressure on prices of Canadian pigs."

From the producer end, COOL implementation for beef products appears to have been fairly smooth so far, according to Derrell Peel, Oklahoma State University extension livestock marketing specialist.

Peel said most cattle auctions in Oklahoma are providing affidavit forms for their customers and proper documentation is often included in routine transaction documents.

At the consumer level, Peel said it appears in Oklahoma, most retail beef is so far using the "Product of USA, Canada and Mexico" label, but more "Product of USA" labels may appear in the future.

"Most major beef packers have designated certain plants and shifts to process mixed label cattle and minimize these costs," said Peel. "This results in some additional shipping costs for some producers. The magnitude of these additional costs for packers and producers is not yet clear."

"The United States has not imported any significant numbers of live lambs since 2004, so there will likely be no impact on our neighboring countries sheep prices due to COOL," stated Peter Orwick, executive director of the American Sheep Industry Association (ASI). "Similar to the balance of livestock, however, the affidavit ASI jointly drafted and supported with U.S. livestock and marketing organizations is working well for sheep producers."
Reprinted in part from meatingplace.com

<< Back