Billings, Mont.R-CALF USA has provided the Office of the U.S. Trade Representative (USTR) with information to show that the American Meat Institute's (AMI's) claim that the U.S. country-of-origin labeling (COOL) law discourages U.S. meatpackers from purchasing foreign cattle is unsupported by actual market information. AMI made this unsupported claim in comments it submitted to USTR on Jan. 8, 2010.
Importantly, data collected by the U.S. Department of Agriculture (USDA), however, show that the 5,157 head of Canadian cattle purchased by U.S. meatpackers during the week of January 4-10, 2010, were purchased at prices much closer in relation to domestic cattle prices than were the prices paid for the Canadian cattle purchased two years ago during the same period (January 7-13, 2008), which was prior to the implementation of COOL.
"We provided USTR with a chart that shows in January 2008, prior to COOL, the U.S. meatpackers were discounting Canadian cattle purchased under forward contracts on a dressed basis $13.17 per cwt below the price they were paying for comparable domestic cattle," said R-CALF USA CEO Bill Bullard. "But today, after the implementation of COOL, these same Canadian cattle are now being priced much closer to domestic cattle, with only a $7.84 per cwt difference in prices.
"These facts show that contrary to AMI's claim, U.S. meatpackers today are assigning a higher value to foreign cattle relative to domestic cattle after the implementation of COOL than they assigned to these same cattle before COOL went into effect," he continued. "These facts also further demonstrate that Canada's and Mexico's complaints against our COOL law filed at the World Trade Organization (WTO) are baseless, just as we have explained in our formal comments to USTR."