Discounts? What steep discounts?
May 19, 2014
The National Cattlemen's Beef Association (NCBA) has announced that it opposes the farm bill. This farm legislation authorizes provisions that thousands of U.S. producers have been waiting for; none more than the ranchers in my home state of South Dakota, where winter storm Atlas ravaged the livestock industry last October. Yet, NCBA opposes it.
On Monday, January 27, NCBA joined the meat packing lobby to announce its opposition to the farm bill (Agricultural Act of 2014). Speaking for NCBA was its president, Scott George, a dairy farmer from Cody, Wyoming who called COOL a "mistake," adding that COOL "has already resulted in steep discounts to our producers."
Discounts? What discounts? I am a U.S. rancher and I haven't noticed that COOL has resulted in any discounts. I'd like to see the evidence Mr. George and NCBA can provide for their brash statement. For the week ending January 25, the combined auction markets in my home state of South Dakota reported 500-600 pound feeder steers bringing an average of $211.06. Last year at this time the same class of cattle was bringing $169.48. Markets across the nation are reporting the same sorts of increases. Let's face it, U.S. markets set the price for Canadian cattle, so Canadian producers are sharing the benefits of our tremendous cattle markets. The COOL revised regulations were implemented on November 23, 2013. Cattle markets have continued to increase since then. The sky has not fallen.
Further, Mr. George says Congress' failure to "fix COOL" will lead to retaliatory tariffs on a host of commodities and that it's "only a matter of time before the World Trade Organization (WTO) rules in favor of Canada and Mexico." That's a worn out argument and it's premature for anyone to attempt to predict what the WTO may or may not do. However, USDA and the U.S. Trade Representative (USTR) believe the COOL revised regulations have brought the COOL program into compliance. Retaliation, if authorized because the US revised regulations are found not to be in compliance with WTO obligations, does not occur before completion of the panel process in Geneva and (if appeals are taken) the Appellate Body process and after arbitration as to the proper level based on the facts. More importantly, if, as the US and groups like USCA believe, the US is in compliance with its WTO obligations, then no retaliation is permitted under the WTO. The briefing process is underway and the parties will have their chance to communicate their views to the WTO panel in the next month with a decision likely sometime in the spring (or later) and the possibility of an appeal by one or all parties. COOL is important legislation and USDA's regulation is an important regulation. Those of us who have pursued improved labeling deserve the opportunity to have our government confirm the correctness of the changes they made to address the first decision. We applaud the Administration's pursuit of U.S. rights, and we applaud Congress's staying the course. That is what we as a nation typically do in these types of situations. There is no reason to depart from that path on COOL.
There is no doubt that the revised regulations do two important things – they address consumer confusion in the marketplace by making clear where muscle cuts of meat are from and second it lets cattle ranchers in the U.S. (and ranchers in our neighboring countries) have their product identified correctly. We know most consumers believe the beef they are buying is from U. S. cattle. Now they can confirm that fact through the retail label. Now is the time we can communicate that fact through factually accurate labels. Similarly, cattle ranchers in other countries have the right to have the origin of meat from their animals correctly identified. When cattle are slaughtered in Canada, the meat products that enter the U.S. have long identified the product as a product of Canada. That is not discrimination against Canadian product; it is a statement of fact. Indeed, beef (or pork or chicken) processed in any country and exported to the United States shows the country of origin and one has seen that in grocery stores across the country for decades. A free trade area doesn't change the origin of where cattle are born, nor does it change the origin of where the animal is raised or where it is slaughtered. We are not citizens of North America. We are citizens of the United States or of Canada or of Mexico. It is beyond absurd to argue that telling people where the food they eat comes from discriminates against producers. Canadians are proud of their farm products as are our Mexican neighbors. Certainly U. S. ranchers are proud of what we do in raising cattle to the highest standards. COOL simply informs consumers of the uncontested facts and lets each country's producers be recognized for their contribution to the product appearing before consumers in retail stores.
Mr. George and NCBA say that the "livestock sector is standing shoulder-to-shoulder in opposition" of the farm bill. That's not true. The truth is NCBA is standing shoulder-to-shoulder with the meat lobby to oppose the farm bill. Saying the livestock sector is unified in its opposition implies that every U.S. rancher opposes the bill and I, for one, do not. This U.S. rancher supports passage of the farm bill just as the vast majority of U.S. producers do. F