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meatpoultry.com – Friday – October 3, 2008 (quotes R-CALF USA CEO Bill Bullard) Are
they truly willing to pay? By Steve Bierklie Is mandatory country-of-origin labeling (mCOOL) an information campaign for consumers or discrimination against foreign livestock and meat products? Bill Bullard, CEO of R-CALF, the independent cattlemen’s association that has been pushing for COOL since the organization’s inception in 1999, says the labeling scheme serves two purposes. "Country of origin labeling is essential to our ability, as American livestock producers, to complete in the marketplace," he told MEATPOULTRY.com. "Labeling meat that was born, raised and processed in the United States as exactly that will benefit those consumers who prefer to buy American-produced products." R-CALF and other mCOOL supporters claim that studies show U.S. consumers not only want U.S.-raised meat, but are willing to pay a premium for it. In 2003, a Florida Department of Agriculture survey found that 62 percent of interviewed consumers would purchase U.S. produce if it carried an identifying label or mark. A 2002 Fresh Trends study claimed that an overwhelming majority of those consumers surveyed, 86 percent, favored a COOL program. Further back, a 1981 study published in the peer-review Journal of Law and Economics suggests that there are added benefits to be gained by using labels to segment the market, allowing consumers to buy the products corresponding to their willingness to pay. When consumers are unable to distinguish the specific qualities of different products, they are not willing to pay as high a price as they would if they were sure the product was of high quality, the research found. "Every survey relevant to the labeling of food has revealed overwhelming consumer support for such labeling and significant concern for information as to where their food is produced," assesses a 2003 International Agricultural Trade and Policy Center report. COOL supporters are also buoyed by this statement in the same report: "This willingness-to-pay calculates into a substantial monetary amount. There are approximately 29,475,000 steers and heifers slaughtered each year. Each animal produces an average of 90 pounds of steak, according to industry experts. Assuming a 10.5% increase in the $4.00 per pound price assumed in the Colorado State study, the aggregate willingness-to-pay is $812.22 million for steaks. USDA scanner data for February, 2003, shows that the average steak price is substantially higher at $4.75 per pound. If we adjust for the USDA data, this results in an aggregate willingness-to-pay of $964.51 million per year based upon the number of steaks produced by U.S. slaughter steers and heifers and based upon the 72.9% of consumers that, according to the study, have such a willingness." "Our belief all along has been that U.S. consumers want U.S. meat and are willing to pay for it," Bullard told MEATPOULTRY.com, adding: "COOL will actually enhance or augment the branded beef programs that already exist." The Food Marketing Institute told MEATPOULTRY.com that it had no data supporting or countering R-CALF’s claim that U.S. consumers will pay more for U.S.-produced meat. Meanwhile, Bullard says R-CALF remains angry with processors who, he claimed, got an 11th-hour loophole added to the COOL regulations, allowing even born-and-raised-in-the-U.S. livestock to be labeled under the mCOOL scheme’s Category B, which gives multiple countries of origin (e.g. "Product of USA, Canada, Mexico"). "This was an issue the packers wanted when the bill was being negotiated in the House of Representatives. They said they needed the loophole to finish out production in the event they ran out of mixed-source livestock. They didn’t want to have to switch labels to the ‘Product of USA’ label in the middle of a production run. We looked long and hard for a way to allow that to happen, but couldn’t find one," Bullard said. "The packers then obviously went to USDA and influenced them before the final rule took effect" on Sept. 30. Even though the mCOOL regulation is now in effect, Bullard said his group and others will continue lobbying for the loophole’s closure. They were pleased, he noted, by the letter sent last week to USDA by 32 senators which called for closing the loophole. "The ridiculousness of this problem is revealed by the fact that USDA’s COOL rules require producers to document the origin of all their livestock, yet packers can do whatever they want. Why should producers have to provide all this documentation when the packers don’t even have to use it?" he stated. "The loophole negates all of the efforts producers would have to make for documentation." He said that if R-CALF and its allies cannot convince USDA to make the change, they will go back to Congress. If that effort fails too, they will go to the courts. "USDA has the ability to fix this very quickly," he commented. "The statute passed by Congress doesn’t even allow this. It violates the spirit of the law." http://www.meatpoultry.com/news/headline_stories.asp?ArticleID=96912 |
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