Progress on COOL, but Canada still threatening retaliation

U.S. Senate and Obama administration need to act quickly, warns Agriculture Minister Ritz

U.S. Senate building

While the House of Representatives has voted strongly to repeal the country-of-origin labelling program, the Senate and the Obama administration need to act quickly as well, warns Agriculture Minister Gerry Ritz.

Otherwise Canada along with Mexico will be putting their case for retaliatory duties to a special meeting of the World Trade Organization Dispute Settlement Body on June 17, the minister said in a statement.

The vote “marks a positive step. The only way for the United States to avoid billions in retaliation by late summer is to ensure legislation repealing COOL passes the Senate and is signed by the president,” the minister added. “The administration and Congress know that COOL is costing thousands of American jobs and billions in economic harm to our highly integrated North American livestock industry.”

The WTO has ruled four times that COOL violates international trade rules the United States helped draft. Canada has said it’ll be seeking WTO authority to impose just over $3 billion a year in duties on American food and consumer products starting in late summer. Mexico expects to request authority for about $1 billion in duties.

U.S. Agriculture Secretary Tom Vilsack has said that repealing COOL is the only option. The Senate has yet to decide on action on the program because of opposition to eliminating the program from several border state senators.

During a recent visit to Washington, Ritz warned that Canada will retaliate against products from their states when it sets its final list.

He said the program must end and not be replaced by some watered-down measures that interfere with trade.

In May, the WTO rendered its final ruling in the COOL dispute which dates back to 2008. The program cost Canadian farmers and processors about $3 billion in lost sales and lower prices.

Ritz reminded Washington audiences that in 2014, agriculture and agri-food trade between Canada and the United States was $51 billion, leaving Ottawa with lots of choices. It published a list of proposed targets for retaliatory tariffs back in 2013.

Meat labels became mandatory in the United States in March 2009 after years of debate. U.S. consumer groups and some farm groups supported the requirement, saying shoppers should have information to be able to distinguish between U.S. and foreign products.

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