US Repeals Controversial Country-of-Origin Labelling Rules

This week, the US side-stepped huge retaliatory tariffs from Canada and Mexico on its meat exports by including language in the recent year-end Omnibus spending bill that repeals the country-of-origin labelling (COOL) requirements for beef and pork products.

The COOL requirements have caused a long dispute between the US and the other countries, which claim the labels disadvantage their exported products.

Earlier this year, the World Trade Organisation (WTO) ruled that COOL requirements were against international trade agreements, and allowed Canada and Mexico to set retaliatory tariffs worth over a billion dollars, which would have come into force after one further approval step from the WTO.

But at the last moment, Congress voted to repeal the rules.

US Agriculture Secretary Tom Vilsack said: "Effective immediately, USDA is not enforcing the COOL requirements for muscle cut and ground beef and pork." – Click here to read the reaction from beef and pork organisations.

In market news, cattle futures have seen some strength so far this week, CME analysts Steve Meyer and Len Steiner report.

“This is curious in the face of cutout values that decreased both Monday and Tuesday, and given the holiday week there has been extremely scarce live animal trade so far this week,” they said.

“However, coming off of an estimated kill level last week of 590,000, steer dressed weights that were down 10 pounds week-over-week, and a bullish Cattle on Feed report this past Friday, the market will continue to take the good news.” - Read more here.

A report this week from Rabobank suggests that tight global beef supply will support prices in 2016, as demand is expected to remain firm even though supply pressure is easing.

China and the US will be the main import markets to watch in 2016 - in particular the strength of demand, given high prices.

Australia, Brazil, India and the US will be the main exporters to watch, Rabobank says - in particular the supply of cattle and beef, in response to rebuilding pressures at different points in the cycle - click here to read more.

We would like to wish all our readers a Merry Christmas and a Happy New Year. The beef newsletter will return on Wednesday 6 January, 2016.