While all is not perfect with USDA's interpretation of the country of origin labeling law, cattle producers say they are “cautiously optimistic” that the new law will benefit their industry.

A preliminary analysis of the rules by the Billings, Mont.-based United Stockgrowers of America found what it says are significant improvements over the voluntary guidelines released by USDA last November.

“For the most part the process is working as USDA has clarified and corrected a number of deficiencies contained in its first draft,” says Leo McDonnell, president of the Ranchers and Cattlemen's Action Legal Fund. “Our industry needs to remain united, focused, and engaged, and if we do, I'm confident we will have rules that maximize lasting benefits for independent U.S. cattle producers.”

Among the improved rules approved by the cattle producers are provisions allowing the addition of water or other enhancers to ground beef and meat, and a labeling method for blended products like ground beef.

The group also believes USDA effectively addressed the liability concerns of both retailers and packers by clarifying that retailers will not be liable for the accuracy of information provided by suppliers, and packers will not be liable if they could not have been reasonably expected to have knowledge of a violation.

In addition, McDonnell says, USDA has lowered its cost estimate for the record-keeping requirements of producers, packers, and retailers from $2 billion to $582 million, and has clarified that it will not require records from producers.

“The rules process is allowing the industry to flush out the misinformation and confusion that has cast a shadow over country of origin labeling in recent months and now we know where we must continue focusing our efforts,” McDonnell says.

Cattle producers represented by the group say there are still changes that need to be made to maximize the benefits of country of origin labeling for producers and consumers.

Specifically, the commodity group disagrees with USDA's cost analysis, which assumes that in order for producers to benefit from labeling, country of origin labeling would have to result in a 1 to 5 percent increase in total demand for a given commodity.

“USDA really missed the mark on this one,” says McDonnell. “U.S. producers already know firsthand that increased demand does not, itself, equate to higher U.S. cattle prices, especially when meat packers can satisfy any increases in demand with unlabeled, imported products.”

“In a global market where producers are faced with increasing imports, country of origin labeling allows producers to differentiate their product. This enables live cattle producers to capitalize on the value of U.S. beef because consumer demand signals for U.S. beef can only be satisfied with U.S. cattle. USDA knows this is the key to enable U.S. producers to compete in both the domestic and international markets,” he says. “As we witnessed first-hand this year, the demand for beef of U.S. origin has increased dramatically and, as a direct result, the value of U.S. cattle has increased right along with this increased demand for U.S. beef. We need only look at the increased demand for U.S. live cattle resulting from our export customer's demands that we no longer send Canadian beef in our U.S. exports.”

The group says USDA's rules also appear to authorize packers to police producers by granting packers the right to have legal access to producer records, and include an increased cost estimate that the packing and retailing sectors would bear for segregating and tracing origins through the production chain.

The Ranchers and Cattlemen Action Legal Fund for the United Stockgrowers of America is a non-profit cattle association boasting 8,700 members in 46 states.


e-mail: dmuzzi@primediabusiness.com