Retail Complications For COOL

Perhaps it is too early to tell, but I’ve always known mandatory country of origin labeling (COOL) is nothing

Perhaps it is too early to tell, but I’ve always known mandatory country of origin labeling (COOL) is nothing more than a little more bookkeeping at the production level.

Packers are still trying to work through the dynamics of how to make it work with minimal cost, but the real concern continues to be raised at the retail level. There are only so many slots that a store has at their disposal when stocking its meat case. Labels require segregation, and suppliers who have opted for a multi-country or U.S. label have found inconsistency in supply to be an issue, as packers struggle with filling orders and maintaining production efficiency.

Ground hamburger is of course the number one product for the beef industry. Its greatest strength in today's cost-conscious climate is its popularity not as a center-of-the-plate item, but as an ingredient (thank you Hamburger Helper). There is a lot of concern about what the multiple country designations might mean for ground beef sales, and concerns that Canada, Australia and the like will exploit our lack of traceability and food safety issues down the road.

There are too many labels and label combinations for the marketers in the retail chains to stock and promote, which may lead to a narrowing of markets. Of course, seafood has had COOL for several years, and that may be the best indicator of what to expect on the beef side. If that’s the case, the growing pains and expense absorbed by packers and retailers will be pretty non-eventful.

I would argue, though, that there is a fundamental difference between items like seafood and bananas where people expect a good deal of the product to be raised outside of U.S. borders. People see plenty of cows around, and may question why there is a need for multiple countries of origin.

Because U.S. product has such a dominant market share, it will be the benchmark for price. The question will be whether the other products will be priced at a discount or premium to the U.S. product.