News 1427 views last update:Feb 25, 2016

COOL dispute costing Canada’s pork industry millions

A report on the Canada/US trade dispute over Country of Origin Labelling (COOL) found that if it is not resolved it could cost the Canadian pork industry almost CAD$500 million annually.

The Canadian Pork Council (CPC) hosted a conference to discuss the findings of a report.  CPC’s Chair, Jean-Guy Vincent was joined by economist Ron Gietz, CPC’s past Chair, Jurgen Preugschas, and trade advisor, Peter Clark of Grey, Clark, Shih and Associates.  The report prepared by Gietz, confirms the industry’s belief that COOL has taken a heavy toll on Canada’s swine industry.  

The report documents and quantifies the cumulative impacts of COOL on Canada’s pork industry.  “In the event the US does not come into compliance or find resolution to the COOL dispute, the report’s findings that the current annual rate of damage accumulation is almost $500 million, can be used to estimate retaliatory tariffs on US exports to Canada,” stated CPC’s Chair Jean-Guy Vincent.  “Faced with continuing damages measured in tens of millions of dollars a month, Canada’s pork industry would prefer a timely resolution to the dispute and an end to the damaging trade restrictions as soon as possible.”

The report indicates that:

  • the direct impacts on hog producers calculated from official live trade data amount to over US$ 1.9 billion as of October 2012, and were expected to  exceed $2 billion by the end of 2012, at the current pace of accumulation of$500 million per year ;
  • in  addition the report estimates  that  $357 million in  pork trade has been lost since the implementation of COOL, and a further $85 million in price suppression of feeder pig trade;
  • additional damages from slaughter hog price suppression and indirect impacts from a reduced sow herd have not been calculated at this time.

The CPC, together with the Canadian Cattlemen’s Association, has been engaged in years of expensive and time consuming challenges and litigation to end the serious discrimination posed by COOL. The two Canadian livestock associations have been working with allies in Canada and Mexico, as well as the United States, to find a timely and effective legislated end to the discrimination against Canadian feeder and slaughter hog exports which has been condemned by the World Trade Organization(WTO).

“We hope that the US will comply quickly with its WTO obligations, but affected Canadian and Mexican industries will press their respective governments loud and hard for swift and effective retaliatory tariffs on US goods in the event of non-compliance.  If we get to that point, imposition of retaliatory tariffs on US pork exports could virtually eliminate existing trade . However Canada does not need to limit retaliation to the red meat or even agriculture sectors.  Goods produced by any sector will be considered as potential targets for imposition of retaliatory import tariffs,” added CPC past chair Jurgen Preugschas.

“COOL is costing Canadian hog and cattle producers tens of millions of dollars every month and needs to be dealt with sooner rather than later,” said Vincent.  “The WTO has concluded its review and the initial findings have been confirmed on appeal and found that the US must change COOL.   There is no further appeal.”

The CPC serves as the national voice for hog producers in Canada.  A federation of nine provincial pork industry associations, our organization’s purpose is to play a leadership role in achieving and maintaining a dynamic and prosperous Canadian pork sector.

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