Jan 16, 2009

Last week, the final rule was published for mandatory Country of Origin Labeling (COOL); the deed is done and packers are required to label product. Proponents of COOL won the war. Price differentials have been discovered with Canadian and Mexican cattle. The proponents got what they wanted and that is that. Now that it’s done, let’s get over it. No more attempts to tweak it or comments that it’s not doing what was intended. It is in the industry’s interest to simply forget about it. Cow/calf producers can simply use an affidavit and let everyone else in the beef chain deal with it. USDA clarified that any covered livestock which don’t have an “M” brand signifying Mexican origin, or a “CAN” brand which signifies Canadian origin, can, by default, be considered cattle of U.S. origin. It’s easy; cattle don’t need USDA 840 tags and, unless required by the individual states, they won’t need any kind of tag or identification other than the “M” or “CAN” brands.

One interesting item is that several years ago, everyone thought the legal aspects of COOL would be punitive and that producers would have to prove the cattle were of U.S. origin. R-CALF made the point that it would be better to force the Canadians and Mexicans to identify their cattle. After that, by default, all others would be of U.S. origin. It only took five years for this idea to make a full circle back to the law we have today.

You can also say goodbye to the National Animal Identification System (NAIS). Any reference to NAIS has been removed from the rule. Several weeks ago, USDA was forced to withdraw a rulemaking document which would have required mandatory premises registration for operations participating in interstate commerce. The law was challenged on the grounds that it violated federal regulatory procedures and was dropped.

When it comes to NAIS, it appears that debate may have ended. Forty-eight-hour traceback was the goal of NAIS and we’ve been told for years that we won’t be able to get back into many of the export markets without it. At that point, it had all the appearance of becoming mandatory.

I’ve never understood why the cattle industry has a desire to micro-manage itself. Markets will, without question, manage the industry. It’s too big and too transparent for it to work any other way. At the end of the day, those producers who produce cattle for a specific market criteria will reap their rewards.

The U.S. has been winning back certain export markets without any traceback system and beef exports are just shy of the pre-BSE volume. I’m sure that there are some markets we could do better in by making NAIS mandatory, such as the European markets, but that is the market’s job, not the federal government. If you want broad market appeal for your cattle, you may utilize a source verification system, but I don’t see why you should be forced to do it. I have received a few e-mails recently from Australian producers who embarked on a national animal ID program. They spent a bunch of money on it. Then the South Korean markets opened up to U.S. beef and the Australians have lost a nice portion of that market to U.S. beef products despite the fact that they have NAIS and the U.S. does not. Now the Australians are wondering why they spent all this money on NAIS, but lost the market to U.S. beef anyway. Australians are receiving no reward for having a big national program. Having a mandatory animal ID system in Canada hasn’t helped them much either.

The next proposals for NAIS will more than likely come from the food safety czars, which still won’t make any sense. But you know how politics are, we wouldn’t have this mandatory COOL mess or NAIS without the aid of politics. I’ve always said that the less the federal government is involved in my business, the happier I’ll be. As I have said before, the new Obama administration will have some issues they want to deal with and I feel that we need to let this COOL situation pass. No more discussion, no more debate, just simply leave it alone. We have more important issues to deal with like free trade, ethanol, taxation, environment and animal welfare. These are all issues that are already in the system and on politicians’ minds. — PETE CROW