Renewed pressure for country-of-origin labelling in the United States could disrupt Canada’s livestock sector unless farmers and processors develop a workable alternative, says Cam Dahl, general manager of the Manitoba Pork Council.
Country-of-origin rules are becoming increasingly important as Canada, the United States and Mexico prepare for more trade negotiations. While questions about where food originates are legitimate, Dahl warned that poorly designed regulations could make Canadian farmers and processors collateral damage.
Canada has faced this problem before.
In 2009, the United States implemented mandatory country-of-origin labelling for red meat. Retailers had to identify where animals were born, raised and processed, forcing plants to segregate Canadian livestock from American animals.
That requirement disrupted highly integrated North American pork and beef markets. Processors faced additional handling expenses, consumers paid higher grocery prices and Canadian hog and cattle producers lost income.
Canada and Mexico challenged the American rules through the World Trade Organization and eventually won after a six-year process.
However, country-of-origin labelling has returned to the U.S. political agenda. Dahl said Canada cannot depend on another successful WTO challenge because the organization’s dispute-settlement system is no longer functioning effectively.
Two developments are causing particular concern.
New American regulations governing voluntary “Product of the U.S.A.” meat labels took effect Jan. 1. Under the strengthened rules, animals must meet stricter origin requirements before meat can carry that label.
Manitoba hog farmers are watching how retailers respond. Suppliers wishing to use the American label may stop purchasing pigs born in Manitoba.
That could affect approximately three million Manitoba weanlings shipped to the United States annually. Those pigs enter American finishing operations as part of an established production system that benefits farms and processors on both sides of the border.
The second concern comes from the U.S. Farm Bill. On Aug. 6, the U.S. Senate Agriculture Committee voted to include mandatory country-of-origin labelling for beef.
Dahl said it would be naive for other livestock sectors to assume the political campaign will stop with beef.
Consumers want transparent information about where farmers raised their food. The agricultural sector should recognize and address that demand rather than dismiss it. If farmers and processors fail to respond, governments will impose rules that may damage food production and trade.
The industry must communicate that Canadian and American livestock production systems are highly compatible. Both countries have comparable farm practices, veterinary drug regulations, and food safety standards.
Many American consumers who express concern about foreign meat do not necessarily view Canadian products the same way they do products from less familiar jurisdictions.
Integrated North American livestock markets increase consumer choice, support food security and help keep retail prices affordable. Breaking those supply chains would introduce costs and reduce flexibility during geopolitical or production disruptions.
Dahl suggested developing a “Product of North America” or joint “Product of Canada and the U.S.A.” label. Such a designation could assure consumers that farmers operating under trusted Canadian or American standards raised the animals.
Creating that system would require agreement on eligibility, auditing and enforcement. Aligning the interests of a Texas rancher, a Manitoba hog producer, processors and two national governments would not be simple.
Still, the approaching review of the Canada-United States-Mexico Agreement creates an opportunity to pursue the idea.
Governments are unlikely to lead. Dahl said farm organizations and processors must first build support and propose a credible system.
The origin question will not disappear. The challenge is to answer it without dismantling the integrated market that helps North American farmers supply safe, nutritious, and affordable food. •
— By Harry Siemens