USDA’s 233-page rule regarding mandatory country of origin labeling (mCOOL) sets the framework for mCOOL that is scheduled to be in place by the end of September. See the rule in its entirety at federalregister.gov/OFRUpload/OFRData/2008-17562_PI.pdf.

The rule covers muscle cuts and ground beef (including veal), lamb, chicken, goat and pork; perishable ag commodities (fresh and frozen fruits and vegetables); macadamia nuts; pecans; ginseng; and peanuts. Commodities covered under mCOOL must be labeled at retail to indicate their country of origin. The requirements of the rule do not apply to covered commodities produced and packaged before Sept. 30, 2008. For beef, lamb, pork, goat and chicken products that are muscle cuts and covered commodities will fall into one of four categories: 1) product of the U.S; 2) multiple countries of origin; 3) imported for immediate slaughter; and 4) covered commodity that is foreign country of origin.

Food-service establishments, such as restaurants, lunchrooms, cafeterias, food stands, bars, lounges, and similar enterprises are exempt from the law. You can see a five-page summary document at: www.ams.usda.gov/AMSv1.0/getfile?dDocName=STELPRDC5070925.

The industry has known for quite some time about the general framework and, of course, the timeline. However, there are a lot of details that will have to be worked out in a fairly short timeframe. The premium for age- and source-verified cattle, which consistently has been running $20/head or more, is expected to widen a little this fall, and these cattle will assuredly have met all the requirements for mCOOL.

The biggest impact of mCOOL is that it’s likely to accelerate the demand for source- and age-verified cattle with traceback capabilities. It’s difficult to imagine that buyers won’t try to capture the additional value of these cattle if they have to absorb similar costs for mCOOL. Long term that means that the premium for source- and age-verified cattle (post 2008), will likely decline as it becomes an industry standard.
-- Troy Marshall