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October 28, 2003   Email to Friend 

COST OF MANDATORY COOL: $3.9 BILLION
The new projection includes $582 million in record-keeping costs for the first year the records and $458 million annually after that.
Debra Davis
(334) 613-4686
October 28, 2003

An official forecast of the costs for a mandatory country-origin labeling (COOL) program is $3.9 billion a year, FEEDSTUFFS reports. "We were hard pressed to come up with any quantification of benefits," said USDA Agricultural Marketing Service official Ken Clayton. The $3.9 billion in direct costs was projected, but USDA reduced a $1.9 billion estimate it had made last year on cost of record-keeping for covered commodities. The new projection includes $582 million in record-keeping costs for the first year the records and $458 million annually after that.

The rest of the $3.9 billion in direct costs will be in capital expenditures slaughter plants and other handlers will have to implement to segregate product, Clayton said. Additionally, USDA economists estimate there will be a cost to the U.S. economy as a whole of $138 million to $596 million per year in reducing purchasing power due to COOL costs. Consumer demand would have to increase 1-5% to cover the cost of the program, he concluded. The 203-page rule is available at www.ams.usda/cool.




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