Canada is considering imposing sanctions of up to $980 million a year against the United States unless it complies with a World Trade Organization (WTO) ruling requiring changes in how it labels meat, according to media reports.
Canadian Agriculture Minister Gerry Ritz said on Tuesday the country would consider "extensive retaliatory measures" against the United States over country-of-origin labels (COOL) introduced in 2009, Reuters reported.
Speaking to reporters after a meeting with U.S. Agriculture Secretary Tom Vilsack, Ritz said the rules are costing Canadian beef and pork producers C$1 billion ($980 million) a year in lost sales, and Canada would look to recoup that amount.
Mexico and Canada successfully argued before the World Trade Organization last year that the labels are discriminatory, and the WTO gave the United States until May 23 to change them.
The new labels, which identify where beef, pork, chicken and lamb sold in the United States come from, sharply reduced U.S. imports of foreign-raised pigs and cattle because they required U.S. packers to segregate imported animals from U.S.-grown livestock.
The U.S. Department of Agriculture on March 12 proposed a rule to alter country-of-origin labeling in an attempt to bring the United States into compliance with its obligations under the WTO. The American Sheep Industry Association filed comments in support of these changes in an effort to keep labeling mandatory for American lamb.