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Food Industry, USDA Lukewarm on COOL

posted on January 31, 2003

Farm groups are continuing to pressure the Bush administration to file complaints against the European Union for its G-M-O labeling rules. Products sold in the European Union containing more than one percent of genetically modified ingredients must carry labels saying as much.

The combination of the labels, and a broad distrust of the technology by Europeans, have effectively killed the European market for U.S. grain and oilseed produced from genetically enhanced seed.

Its distaste for the EU's labels may explain in part the reluctance of the administration, and much of the farm lobby, to implement country of origin labels on meat and produce sold in the U.S.


Food Industry, USDA Lukewarm on COOL

The 2002 Farm Law contains provisions enacting country of origin labeling, or COOL. There are already labeling rules in place for products packaged in consumer-ready containers, but under the new measure, items delivered to the back door of the store, but later broken up for retail sales, must carry a label identifying their source. Currently, the labeling of future COOL category products, like meat and poultry, is voluntary.

Both the USDA and industry groups have been luke-warm to COOL. Current projections place the cost of implementation at $2-billion.

In a study conducted by the Food Marketing Institute, a group that conducts market research on the wholesale and retail food industry, it was revealed that U.S. consumers want to know where their food is coming from. Even so, industry groups are concerned that no survey indicates if consumers would be willing to absorb the increased cost for labeling. Ultimately, the job of keeping products separate falls on the shoulders of the retailer, who stands to receive a hefty fine for any COOL violations.

Even with the objections from distributors, one group, The National Cattleman's Beef Association, has been a proponent of the new rules. The cattlemen argue consumers would most likely prefer to purchase U.S. products if they had a choice. The Modoc County Cattlemen's Association, a California based member of the beef producer group, is even offering a "Born in the USA" label for any retailer who is voluntarily participating in the federal program.

The move may be an attempt to preserve a slipping market share. According to the USDA, 27% of the 13-million tons of beef sold in the U.S. in 2001 came from foreign sources.

Regardless of opinions on both sides, all retailers will have to comply with COOL regulations at the end of September 2004.


Tags: agriculture food groceries industry news USDA