990568 US Meat Rules May See NAFTA, WTO Challenge

Washington - Canada will respond, through trade-rule challenges or tit-for- tat restrictions, if the United States requires country-of-origin labels on meat, according to a letter made public this week.

A handful of bills were pending in the U.S. House and Senate to require the special labels. Cattle ranchers believe U.S. consumers would buy American meat if given the chance. About nine percent of the U.S. meat supply is imported.

Some 1.1 million head of cattle were shipped from Canada for slaughter in U.S. packing plants last year. A National Cattlemen's Beef Association official said the cattle were “laundered” because the meat was sold with a U.S. inspection stamp.

“If these proposals proceed, Canada will not hesitate to invoke its rights” under the North American Free Trade Agreement or the World Trade Organization, Ambassador Raymond Chretien wrote.

Chairman Richard Lugar, Indiana Republican, read the May 21 letter aloud during a Senate Agriculture Committee hearing on the proposals. It said the U.S. proposals were inconsistent with U.S. trade commitments and could imperil $2.4 billion in bilateral cattle and red meat trade.

“Enactment of additional mandatory country of origin labeling requirements will encourage other countries to implement similar measures,” the ambassador wrote, before noting Canada bought $350 million a year in U.S. beef.

“To our friends in Canada, I say, tough luck, Ottawa,” said Senator Tim Johnson, South Dakota Democrat, an early advocate of the labels. “We need to do what's right for our consumers.”

Agriculture Secretary Dan Glickman, who testified at the hearing, did not take a position on the legislation. He said if legislation was pursued, it should be carefully drawn so it would not cause trade friction.

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