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US faces $1 billion in trade penalties for meat labels

The World Trade Organization today authorized Canada and Mexico to impose more than $1 billion worth of retaliatory tariffs on US products in response to the country of origin labeling law. A draft list of exports that could face the tariffs included live animals, meat products, pasta and wine.

This is not the first time the WTO has found USA law to be in violation of its non-discrimination and national treatment requirements. “USA farmers and ranchers could suffer a serious blow if Congress does not act quickly”, Stallman said in a news release.

If the Senate doesn’t repeal the labeling rules, “U.S. beef exports will face a 100 percent tariff in these countries, severely diminishing about $2 billion of beef exports annually”, president Philip Ellis said in the statement.

The National Pork Producers Council cited research by Iowa State Univ. economist Dermot Hayes that showed the average U.S. pork producer now is losing money on each hog marketed. “We urge Congress to bring the USA into compliance”.

Under WTO rules, there can be no appeal against this ruling.

“What we want is for the US Senate to be motivated to repeal COOL”, he said. Many U.S. groups also are in favor of repeal, citing potential damage to trading relationships with Canada and Mexico and depressed economic returns due to the tariffs.

U.S. Senate agriculture committee chairman Pat Roberts, a Kansas Republican, said Monday that he will look for “all legislative opportunities” to repeal the labelling law.

Annual tariffs approved Monday would total $1.05 billion (Canadian), or $780.4 million (U.S.), for Canada and $227.8 million for Mexico. Trade partners claim the required segregation of foreign livestock in the United States places an unfair, costly burden on their pork and beef industries.

Business interests outside of agriculture have also been paying close attention to the COOL saga since the retaliatory tariffs are not confined to agricultural products.

But Roberts said Monday it is time for them to throw in the towel. Goodman said MSGA is hopeful something similar can be used to identify US meat. The government of Canada has made every effort to convince the United States to comply with its worldwide trade obligations. US dairy producers and processors cannot lose this chance to avoid considerable damage to the export markets they have invested so heavily in developing in recent years.

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