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Texas Agriculture Archive

November 7, 2003

Proposed COOL rule
'vague, non-specific'

USDA's long-awaited and much anticipated proposed rule on Country of Origin Labeling (COOL) is little more than a running commentary on the controversial issue, says a Farm Bureau official.

Jon Johnson, Texas Farm Bureau associate director of Commodity and Regulatory Activities, said the 200-plus page document is a rehash of comments made at a series of listening sessions held by USDA across the country.

"The document released Oct. 28 provides a basic outline—nothing is set in concrete," Johnson said, noting that he hadn't had time for a full analysis at press time. "It gives an indication of where USDA wants to go but doesn't set a direct path to get there."

He noted USDA's usual rule-making process starts with a proposed rule, followed by a comment period, and a final rule.

"In my mind this is not a set of identifiable regulations," he said. "Based on what we have read—the information that has been put out by USDA— it's almost impossible to comment because the so-called proposed rules are vague and non-specific."

Farm Bureau policy currently supports COOL provided it is not unduly burdensome to the producer and is economically feasible.

Based on this Oct. 28 document, Johnson's uncertain of the shape of the final rule at the Sept. 30, 2004 deadline.

"What's a producer supposed to do to be in compliance with COOL? This document doesn't tell me," he said.

AFBF analysis

Meanwhile, the American Farm Bureau Federation offered their reading of what the proposed rule indicated.

Key provisions, according to AFBF, include the following:

1) Under the proposed rule, muscle cuts of beef, veal, lamb, and pork; ground beef, ground lamb and ground pork; farm raised fish and shellfish; wild fish and shellfish; fresh and frozen fruit and vegetables; and peanuts must be labeled at retail to indicate country of origin.

2) The notice of country of origin for fish and shellfish must include and distinguish between wild and farm raised fish and shellfish, as required by the legislation.

3) Commodities are excluded from labeling if they are an ingredient in a processed food item. Examples of covered commodities excluded under this provision of the proposed rule would be bacon, orange juice, mixed nuts and fruit, vegetable party trays.

4) Food service establishments, such as restaurants, lunchrooms, cafeterias, food stands, bars, lounges and similar enterprises are exempt from the labeling requirements.

5) For beef, the covered commodity must be derived exclusively from animals born, raised and slaughtered in the United States, including animals that were born and raised in Alaska or Hawaii and transported for a period not to exceed 60 days through Canada to the United States and slaughtered in the United States.

6) For lamb and pork, the covered commodity must be derived exclusively from an animal that was born, raised and slaughtered in the United States.

7) Farm raised fish and shellfish covered commodities must be derived exclusively from fish or shellfish hatched, raised, harvested and processed in the United States.

8) Covered commodities for wild fish and shellfish must be derived from fish or shellfish harvested in the waters of the United States or by a U.S. flagged vessel and processed in the United States or aboard a U.S. flagged vessel.

9) In the case of perishable agricultural commodities and peanuts, the covered commodities must be derived exclusively from produce or peanuts grown in the United States.

10) Ground beef containing beef from several countries is required to list each country alphabetically on the label.

11) In the USDA's voluntary rule, producers would have had to list what percentage of the meat came from each country. This was dropped because it was considered too burdensome a requirement.

12) Products that contain several of the covered commodities, such as a salad mix, are exempt from the requirement.

13) In the case of meat, the addition of water or seasonings does not constitute a blended or new product and, thus, is bound to the requirements.

14) The USDA lowered the length of time grocery stores are required to keep origin records—from 14 days, under the voluntary rules, to seven days. This reduction is viewed as a way to lower costs. Corporate records still have to be maintained for two years.

15) Under the proposed rules, retailers escape liability for erroneous labeling except under "obvious" cases. For instance, when a retailer is promoting a commodity as being a product of the United States when that commodity is out of season, officials said.

Comments are due by Dec. 29, 2003. The official rule will be published in the Federal Register on Oct. 30.

AFBF also analyzed potential impacts of USDA's proposed rule. Those, according to the farm organization, include the following:

•There is significant debate about the cost versus benefits of mandatory labeling. The proposed rule estimates first-year implementation costs from $585 million to $3.9 billion. The rule states that the program will have a negative impact on the U.S. economy of between $138 million and $596 million.

•USDA has stated that survey findings show that COOL is of interest to majority of consumers and there is a willingness to pay for labeling; however market evidence indicates limited demand for COOL.

•The proposed rule contains a statement that U.S. exports are expected to decrease if labeling is implemented. However, earlier this year, Japan demanded a system to differentiate U.S. and Canadian product for animal health purposes.

•The proposed rule states that packers and processors of covered commodities will need to inform retailers and wholesalers as the country of origin. Their suppliers will need to provide documentation stating origin.

The rule specifically states that agricultural producers and fish harvesters will need to create and maintain records to establish country of origin information for the products they sell.

•Meat packers are responsible for possessing or having legal access to records that substantiate where animals were born, raised and slaughtered.

Copies of the proposed rule and additional information can be found at http://www.ams.usda.gov/cool.

Written comments may be directed to: Country of Origin Labeling Program, Room 3093-S; Agricultural Marketing Service (AMS), USDA; STOP 0249; 1400 Independence Avenue, SW.; Washington, D.C. 20250-0249, or by facsimilie to 202/720-3499, or by email to cool@usda.gov. State that your comments refer to Docket No. Ls-03-04.

Comments received will be posted to the AMS website at http://ww.ams.usda.gov.cool.

Comments sent to the above location that specifically perrtain to the information collected and recordkeeping requirements of this action should also be sent to the Desk Officer for Agriculture, Office of Information and Regulatory Activities, Office of Management and Budget (OMB), New Executive Office Building 725 17th Street, NW., Room 725, Washington, D.C. 20503.