Voluntary COOL Benefits Producers and Consumers

There’s been a lot of talk recently about mandatory Country of Origin Labeling (COOL). Let’s set the record straight on a few things.

First, TCFA supports voluntary COOL. We know that U.S. beef is the best in the world in terms of quality, consistency and sustainability and we support a label that highlights those high standards.

However, that label should be market-driven, not mandated by the federal government.

Market-driven programs have proven to be effective, not only for the ranching and feeder families that are the very foundation of our nation’s beef supply, but also for consumers who enjoy high-quality, affordable, nutritious beef. One of the best examples in the history of beef production and marketing is Certified Angus Beef....a voluntary marketing label that has added millions and millions of dollars to the value of beef through increased demand for quality beef.

Mandatory COOL was federal law for 6.5 years, but that law ended up costing all U.S. cattle producers significantly with no measurable benefit to consumers. Let’s visit a few of the reasons mandatory COOL failed the first time.
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1. Mandatory COOL nearly ruined our trading relationship with Mexico and Canada. On four separate occasions, the World Trade Organization (WTO) ruled mandatory COOL was discriminatory and violated international treaty obligations.
2. Because of this, the WTO authorized Mexico and Canada to impose more than $1 billion in retaliatory tariffs against U.S. exports, including a 100% tariff on U.S. beef in Mexico and Canada if the law was not repealed. In 2019, beef exports to Mexico and Canada added over $65 in value per animal. This added value would no longer exist had mandatory COOL not been repealed.
3. Exports not only add value to our product, but they create jobs. USDA’s Economic Research Service reported that for every $1 billion in agricultural exports, 7,500 jobs were required. Simply put, mandatory COOL costs valuable American jobs.
4. Tariffs imposed by Mexico and Canada would have translated into unnecessary higher prices for consumers and lower prices for producers. USDA cited in its report to Congress that the total economic harm to the U.S. beef industry would have been more than $8 billion over a ten-year period.
5. There are no studies that document mandatory COOL increased prices of cattle for U.S. producers and several to the contrary identifying only increased costs to the U.S. beef system.

Rep. Mike Conaway (R-Midland)​, Former Chair of the House Ag Committee, in June 2015 laying out how retaliatory tariffs in response to mandatory COOL would hurt U.S. agriculture. Congress ultimately repealed the law.

​Congress subsequently repealed mandatory COOL in 2015 three days before the tariffs were scheduled to go into effect because of the undue harm the law itself and potential retaliatory tariffs would cause U.S. producers and consumers. Even though Congress prevented WTO from placing tariffs on U.S. beef in 2015, the WTO case remains active. If, at any time, the U.S. implements a new mandatory COOL program, Canada and Mexico can immediately retaliate. They don’t need any additional approval from the WTO.

As we’ve learned time and time again, increasing the government’s involvement in our day-to-day operations with a mandatory label would prove disastrous and ineffective, even more so, during a time when the entire country, especially the cattle industry, is facing unprecedented and extraordinarily difficult times due to the COVID-19 pandemic.