Washington Insider -- Friday

A New COOL Debate

Here’s a quick monitor of Washington farm and trade policy issues from DTN’s well-placed observer.

USDA Announces Intention to Take Another Swing At GE Crop Rules

USDA's Animal and Plant Health Inspection Service (APHIS) announced it is considering changes to rules on genetically engineered crops that would allow the agency to focus on "risks that may be posed by certain GE organisms rather than on the methods used to produce the product."

Changes to the APHIS rules would also make the regulatory process "more transparent while removing unnecessary regulatory burdens," according to the agency.

The notice to be in today's Federal Register provides little insight into how the rules might be revamped, asking for stakeholder input on an array of issues related to APHIS' authority over GE plants and how interested parties may be affected.

The move marks the third time APHIS has launched a rulemaking to try and change its 30-year old GE crop regulations.

Sen. Brown is talking with USTR to exempt Canada, Mexico from steel tariffs

Sen. Sherrod Brown, D-Ohio, said he was working with U.S. Trade Representative (USTR) Robert Lighthizer on a way to exempt Canada and Mexico from steel and aluminum tariffs imposed by President Donald Trump.

Brown said Trump's tariffs were necessary to protect U.S. steel and aluminum producers against the damaging effect of Chinese excess capacity. But he said shared the concern of many senators about Canada and Mexico being covered by the tariffs.

"I am working with the administration to reach a solution through negotiations. I encourage my colleagues to do the same," Brown said. "I talked to Ambassador Lighthizer last night. We are in a holding pattern with the NAFTA talks until Mexico’s election on July 1. But soon after that election, the NAFTA talks will pick right back up and steel and aluminum tariffs will be part of that dialogue.”


Washington Insider: A New COOL Debate

Food Safety News is reporting this week that two influential groups are arguing that it would help domestic producers and consumers alike if USDA would change its labelling policies for meat. The Lincoln, Neb.,-based Organization for Competitive Markets and the Denver-based American Grass-fed Association have petitioned the Food Safety and Inspection Service (FSIS) for the policy amendment.

FSN says that current USDA policy permits labeling meat as a “Product of the USA” if it meets either one of two criteria. The first is if the country to which the product is exported requires the labeling and the product is processed in the U.S.

The second is if the product is processed in the U.S.

Instead, the two groups want new language that would read, “If it can be determined that significant ingredients having a bearing on consumer preference such as meat, vegetables, fruits, dairy products, etc., are of domestic origin (minor ingredients such as spices and flavorings are not included). In this case, the labels should be approved with the understanding that such ingredients are of domestic origin.”

OCM and AGA are concerned that the current USDA policy allows foreign imported meat and meat products to be brought into the U.S., processed through a USDA inspected plant and labeled “Product of U.S.A.” They say that is counter to the legal authority granted to FSIS in federal law and by its regulations.

As a result, they argue that the current policy is having the very adverse outcomes on farmers and consumers that Congress specifically stated were the consequences it intended to prevent when enacting the Federal Meat Inspection Act.

Now, FSIS has opted to put the petition out for public comment until Aug. 17, a sign the agency may give serious consideration to the change.

The current policy has more impact on some market segments than others, FSN says. About 91% of U.S beef consumption is from domestic production. However, only 20 to 25 of the grass-fed beef market in the U.S. is from local suppliers. Grass-fed beef from Australia and South America make up the difference; some with a “Product of USA” labels due to USDA’s policy.

The organizations argue that the products most affected by the current policy are those from firms who have been transitioning their operations to grass-fed beef. “This market opportunity has been the one bright spot in U.S. cattle production with sales nearly doubling annually,” the petition says.

OCM is a national organization with the stated purpose of working on behalf of America’s farmers and consumers to ensure agricultural markets are fair and transparent. It is a public policy research and advocacy organization. OCM has been a leader in efforts to ensure consumers have “the information they need to know the origin of their meat and meat products.” The group played a crucial role in the passage of mandatory Country of Origin Labeling in 2002, FSN says.

OCM claims the current USDA labeling policy hinders its effort to assist US family farmers in connecting with U.S. consumers who demonstrate a preference for US domestic meat and meat products. AGA is the nation’s leading organization in the development of grass-fed meat production and market development for producers of grass-fed beef, dairy, and pastured pork.

Congressionally mandated Country-of-Origin labeling was repealed after the World Trade Organization found it violated restrictions on non-tariff barriers to international trade. WTO would have permitted Canada and Mexico to imposed retaliatory tariffs on the US if the COOL regulations had remained in place.

In spite of the findings of the international regulatory authorities concerning the earlier COOL regulations--and the certain strong opposition from trading partners to the new labels--protectionist sentiments across country are much stronger now than they were when the earlier labels were imposed. So, we will see. This is yet another fight that could affect markets and trade and one producers should watch closely as it emerges, Washington Insider believes.

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