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Country of Origin: What's in a Label?

Tuesday, October 14, 2008

Country of Origin Labelling is the next step to an entirely open marketplace for the US. In an ideal supermarket, consumers can understand as well as see the product that they are purchasing and they can monitor the system of production which has brought it to their aisles, but what are the real issues that follow this dream, asks Adam Anson, reporting for TheCattleSite, and what implications does COOL bring back to the producer?

The long awaited Country of Origin Labeling rules - widely abbreviated to COOL - came into effect in America on the 30 September. The belief is that by tracking food items from farm to fork the department of agriculture will be better equipped to monitor where the food chain safety precautions break down when things go wrong. Diseases could theoretically be tracked and stopped before they reach consumer's plates, but the implications of COOL hold further promises for the consumer.

In this age of variety and choice, consumers want to know where their food comes from. A Consumer Reports poll last year found that 92 per cent of Americans agree that imported foods should be labelled by their country of origin. Not only do they want that assurance that they are buying a safe product from a reliable producer but they also want to know what industries and communities they are supporting or boycotting with their money; be they local, deprived, ethical, or eco-friendly.

For a long time these things have been in the hands of big businesses, but now the control is sliding back to the buyer. Public relations are the political campaigns of the marketplace and without it, big businesses are powerless.

COOL will undoubtedly put pressure - the kind producers actually feel and listen to - on countries to prioritize food quality. This, in turn, is a real incentive for the entire food sector to to make sure they are putting out a reliable product, for any error will tar each and every producer, no matter how scrupulous they are. Whether this is a detrimental link for the producer or not, we are yet to find out.

The Reality of a Label

A Summary of the Detail

The rule covers muscle cuts and ground beef (including veal), lamb, chicken, goat, and pork; perishable agricultural commodities (fresh and frozen fruits and vegetables); macadamia nuts; pecans; ginseng; and peanuts -- as required by the 2002 and 2008 Farm Bills. USDA implemented the COOL program for fish and shellfish covered commodities in October 2004.

According to the USDA, commodities covered under COOL must be labeled at retail to indicate their country of origin. However, they are excluded from mandatory COOL if they are an ingredient in a processed food item.

USDA has also revised the definition of a processed food item so that items derived from a covered commodity that has undergone a physical or chemical change (e.g., cooking, curing, smoking) or that has been combined with other covered commodities or other substantive food components (e.g., chocolate, breading, tomato sauce) are excluded from COOL labeling.

Food service establishments, such as restaurants, lunchrooms, cafeterias, food stands, bars, lounges, and similar enterprises are exempt from the mandatory country of origin labeling requirements.

The rule outlines the requirements for labeling covered commodities. It reduces the record keeping retention requirements for suppliers and centrally-located retail records to one year and removes the requirement to maintain records at the retail store. The law provides for penalties for both suppliers and retailers found in violation of the law of up to $1,000 per violation.

The rule prescribes specific criteria that must be met for a covered commodity to bear a "United States country of origin" declaration. In addition, the rule also contains provisions for labelling covered commodities of foreign origin, meat products from multiple origins, ground meat products, as well as commingled covered commodities.

So what are the requirements of COOL? According to the United States Department of Agriculture, items that do not need to be labelled are "Meat, poultry, and fish purchased in annual amounts under $230,000; organ meats; processed foods; mixtures; and restaurant and cafeteria food, which includes salad bars, even supermarket salad bars."

Most smaller butcher shops and fish markets won't exceed the $230,000. It is estimated that maybe 15 percent of all the meat sold in Nebraska will be exempted

The USDA predicts little economic benefit from the new labels and says their biggest impact will be additional cost. Analysts have concluded that the labels will cost 1.2 million farmers and food businesses a combined $2.5 billion to implement in the first year. The estimate includes new paperwork requirements and possible changes to plant operations, line processing, product handling and storage.

USDA analysts say the higher costs will bump food prices up, although by less than 1 cent per pound for affected products.
Probably the most extensive changes will affect meat. About 10 percent of hogs and cattle slaughtered each year in U.S. packinghouses -- about 10 million hogs and 2.5 million cattle -- were born in Mexico or Canada.

But USDA officials say the new labels are no guarantee of food quality. The change is being implemented by the marketing arm of the USDA, not its Food Safety and Inspection Service.

In many ways it is not a food safety provision at all, but purely a marketing provision. Both imported and domestic food will continue to be subject to existing food safety standards

Trouble Ahead?

The National Farmers' Union of the Unites States has been a steadfast supporter of the labelling law and played a key role in negotiating the compromise that allowed for the provision to be included in the 2008 Farm Bill. However, NFU President Tom Buis expressed several concerns with USDA’s interpretation.

Although the feeders selling cattle to the meatpackers will provide documentation about where their animals were born, some meatpackers say it will be difficult and expensive to maintain separate identification of foreign-born and native-born animals as they move through the packinghouse.

Some packers may opt to label their meat as products of the U.S., Canada and Mexico, rather than attempt to claim an exclusively U.S. origin for only part of their production. Farm groups have criticized that strategy, saying it would defeat the purpose of labelling .

The Government of Canada is disappointed the U.S. is moving forward with the COOL legislation. Minister Ritz said: "The possibility that this may discriminate against Canadian products is a concern, therefore, the Government of Canada is working with industry and the provinces and territories to minimize any impact on Canadian farmers and ranchers."

Some Questions and Answers from the USDA Agricultural Marketing Service

Q. When can muscle cuts of meat be labeled as “Product of the U.S.? A. Covered commodities may bear a US origin declaration if they are derived from animals born, raised and slaughtered in the US, from animals born in Alaska or Hawaii, and transported through Canada for less than 60 days and slaughtered in US, or from animals present in the US on or before July 15, 2008.
Q. How do I label imported muscle cuts of meat? A. Imported commodities for which no production steps occur in the US retain the origin as declared to U.S. Customs and Border Protection.
Q. How do I label muscle cuts of meat from animals raised in “Country X” but imported for immediate slaughter in the U.S.? A. Meat from animals imported for immediate slaughter in the U.S. shall be designated as Product of Country X and the U.S.
Q. Can a packer or intermediary supplier that processes whole muscle meat products derived from both mixed origin animals (e.g., Product of U.S., Canada and Mexico) and U.S. origin animals commingle and label these products with a mixed origin label? A. If meat covered commodities derived from U.S. and mixed origin animals are commingled during a production day, the resulting product may carry the mixed origin claim (e.g., Product of U.S., Canada, and Mexico). Thus, it is not permissible to label meat derived from livestock of U.S. origin with a mixed origin label if solely U.S. origin meat was produced during the production day.
Q. How do I label muscle cuts of meat from animals that are in “Category B” (animals that were born, raised and/or slaughtered in the U.S. and not imported for immediate slaughter)? A. Meat from these animals should be labeled as, Product of the U.S., Canada, and Mexico or Product of the U.S., Canada, Mexico. To provide consistency in the labels and to avoid consumer confusion, the terms “or” and “and/or” in the country of origin designation declaration shall not be used (e.g., retailers should not label their products Product of the U.S., Canada, or Mexico or Product of the U.S., Canada, and/or Mexico). In addition, more specific information can also be provided. For example, meat derived from hogs that may have been born in Canada but raised and processed in the United States can be labeled as, Product of the U.S. and Canada; From hogs born in Canada or Product of the U.S. and Canada; Processed in the United States.
Q. Can a retailer, like a meat packer, label meat products derived from livestock born, raised, and slaughtered in the United States (i.e., Product of USA) as having a mixed origin (e.g., Product of the United States, Canada, and Mexico)? A. Similar to packers and intermediary suppliers, retailers are permitted to market U.S. produced meat products under a mixed origin label (e.g., Product of U.S., Canada and Mexico) if they are commingled with meat of mixed origin. That is, if a retailer further processes meat at the store and the resulting package includes meat of both U.S. origin and mixed origin (e.g., Product of U.S., Canada and Mexico), the origin declaration can read Product of U.S., Canada and Mexico.
Q. If a packer, intermediary supplier or retailer handles whole muscle meat products derived from both mixed origin animals (e.g., Product of U.S., Canada and Mexico) and direct for slaughter animals (e.g., Product of Canada and U.S.), can the product be commingled and labeled using the direct for slaughter label with all applicable countries of origin listed (i.e., Product of Country X, U.S. and Country Y)? A. Yes. If meat covered commodities derived from mixed origin and direct for slaughter animals are commingled, the resulting product may carry the direct for slaughter origin claim (i.e., Product of Country X and U.S.) with other countries of origin as applicable.
Q. What should be stated on the origin declaration for ground meat covered commodities if raw materials from several different countries are used during the manufacturing process? A. In accordance with the interim final rule, all actual or reasonably possible countries of origin must be listed on the origin declaration, in any order. In determining what is considered reasonable, when a raw material from a specific origin is not in the processor’s inventory for more than 60 days, that country shall no longer be included as a possible country of origin.
Q. Do non-muscle carcass components such as cheek meat, hearts, and added beef fat have to be identified with origin information when used in the manufacture of ground meat in accordance with the COOL interim final rule?
A. In general, muscle cuts of meat derived from the Institutional Meat Purchase Specifications (IMPS) Series 100 (beef), 200 (lamb), 300 (veal), 400 (pork) and 11 (goat) are all covered commodities. Products derived from Series 700 for Varietal Meats and Edible By-Products are excluded from COOL labeling requirements if sold at retail as a variety meat.

Further Reading

- You can view the Interim Final Rule by clicking here.

October 2008

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