Study: Country-of-origin labels don’t hurt beef trade

A picture taken on June 11, 2013 shows Holstein cows in a farm in Laqueuille, centre France. AFP PHOTO THIERRY ZOCCOLAN (Photo credit should read THIERRY ZOCCOLAN/AFP/Getty Images)
Photograph by Thierry Zoccolan — AFP/Getty Images

If the debate over country-of-origin labeling (COOL) were confined to the pros and cons of letting consumers know where their food comes from, that would be great. Instead, the debate, especially when it comes to meat, is clouded by a bunch of different interests and side issues of varying degrees of legitimacy: the meatpacking industry’s corporate interests, ostensible First Amendment complaints, the interests of industry critics looking for any excuse to penalize big meatpackers, and, perhaps most of all, international trade squabbles.

One problem, especially when it comes to the trade issue, is a lack of reliable data. Canada says it’s losing $1 billion a year due to a U.S. rule that beef sold here be identified by its country of origin. A new study by an Auburn University economist blames those losses on “turbulent economic times,” and says COOL has had a negligible impact on imports from Canada and Mexico.

The study’s author, agricultural economist C. Robert Taylor, wrote: “COOL has not had a significant negative effect on the price paid for imported slaughter cattle relative to comparable domestic cattle, COOL has not had a statistically significant negative effect on imports of feeder cattle relative to U.S. feeder cattle placements, and COOL has not had a negative impact on imported cattle for immediate slaughter.”

The study was commissioned by the National Farmers’ Union, which supports COOL, and supported by other groups that favor labeling.

Last fall the World Trade Organization ruled that COOL rules are unfair and discriminate against meat imports, giving U.S. meat products a marketplace advantage. The United States has appealed the decision.

The study has its detractors, of course. Jim Wiesemeyer, senior vice president of Informa Economics, told Farm Journal that Taylor “cherry picked” the time period he studied. The data included exports starting in 2005, he noted—when there were trade restrictions on live cattle coming from Canada because of worries over BSE (Mad cow disease). If the study had gone back some years before 2005, he said, it “would have had nearly opposite results.”

Taylor stood by his methodology, responding that responded that the data he used—Mandatory Price Reporting data that meatpackers provide to the USDA—doesn’t go back further than 2004, and that year’s export data was unreliable.

Earlier studies—some of which were used by the WTO in reaching its decision—showed that COOL has crimped Canadian exports to the United States. Farm Journal notes that those studies came from Canadian trade organizations.

Of course, none of this has much to do with whether COOL labels are good for American consumers, which is the ostensible reason for their existence. American consumers sure like them, though, with polls constantly showing overwhelming support.

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