USDA: COOL does not increase demand and provides little economic benefit

The U.S. consumer’s desire for information regarding country of origin labeling does not result in an increase in consumption of beef, pork or chicken, and provides negligible economic benefit. This was the findings by the USDA in its report, “Economic Analysis of COOL,” that was recently sent to Congress.

The report said that consumers desire COOL information but “there is insufficient evidence to conclude that such benefits translate into measurable increases in consumer demand for beef, pork or chicken.” The report concluded the costs of COOL’s labeling requirements outweigh the economic benefits of the rule. The report said the “economic benefits of implementing the COOL regulations would be insufficient to offset the costs of the requirements whether analyzing the impacts through economic models of beef, pork and poultry industries or of the U.S. economy as a whole.”

In a letter accompanying the report to the House and Senate Agriculture Committees, Secretary of Agriculture Tom Vilsack said, “Should the WTO Appellate Body find that some aspect of the COOL requirements remains inconsistent with the United States’ WTO obligations, USDA stands ready to work with Congress and USTR to resolve this trade dispute. A resolution would depend on the relevant findings of the Appellate Body and could include statutory changes such as repeal of the COOL requirements or establishing a generic label.”

In a statement, House Agriculture Chairman Michael Conaway (R-TX) expressed concern about potential trade sanctions resulting from the World Trade Organization’s ruling: “In order to avoid what could be devastating retaliatory sanctions against U.S. businesses if we lose, the starting point needs to be that mandatory COOL for meat is a failed experiment which should be repealed.”

The WTO is expected to issue its final ruling by May 18 regarding Canada and Mexico’s case against the United States. The comprehensive economic analysis was mandated in the 2014 farm bill.

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