Canada Puts Hold on WTO Complaint Against U.S.

U.S. revisions appease Canadians for the moment.

While the added flexibility to Country-of-Origin Labeling may end up causing arguments and challenges within the U.S., it seems to have helped alleviate some trade tensions with Canada.

Canadian Agriculture Minister Gerry Ritz says Canada will shelve for now its World Trade Organization complaint about U.S. rules that require a country-of-origin label on meat sold in American grocery stores. He said revisions to U.S. rules that allow greater labeling flexibility now meet Canadian needs and is good news for the Canadian livestock sector. Ritz said the U.S. changes should boost export volumes and prices.

"The price spread of U.S. meat over Canadian meat in the U.S. market had gone to "wonky" levels as the country-of-origin regulations were phased in," Ritz said. "But, now this should return to more normal levels since we've gotten what we've asked them to do."

Ritz said Canadian exports were hit by the labeling requirement but he said it was difficult to say by how much. He expects to see live animals moving south.

The United States agreed to allow a label showing a mixed origin, for example saying beef was of U.S. and Canadian origin. This means meat packers and producers will not have to incur the extra cost of segregating Canadian animals.

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