Background: What Is COOL and Why It Matters

Country-of-Origin Labeling (COOL) for meat became mandatory in the U.S. in the 2000s (effective 2009 for fresh meats) with the intent to inform consumers of where their food animals were born, raised, and slaughtered. Proponents argued that labeling beef, pork, chicken, and other foods by origin would let American consumers preferentially buy U.S.-produced meat, potentially boosting domestic producer prices, while opponents warned of higher supply chain costs and trade disruptionsagmanager.infoagmanager.info. From 2009 until its repeal for beef and pork in late 2015, COOL’s actual economic impacts were studied extensively. Overall, research finds little evidence that COOL raised prices for U.S. livestock producers; instead, most studies show no market price increase or even a net negative effect on U.S. beef and pork producer income, once compliance costs and trade effects are factored injaysonlusk.comksre.k-state.edu. The outcome did vary by species and industry structure – the largely self-contained poultry (chicken) sector saw different results than the more complex beef and pork sectors. Below we summarize U.S.-based economic research and data (2000–present) on COOL’s impact, including effects on producer prices, species differences, and related changes in packer and retailer behavior.

Beef (Cattle) Sector: No Price Premium and Potential Losses

Early economic analyses predicted that unless COOL sparked a substantial jump in consumer demand for U.S.-labeled beef, cattle producers would likely see no benefit and even incur losses. For example, a 2004 Journal of Agricultural and Resource Economics study estimated that feeder cattle producers would lose income over 10 years unless retail beef demand rose by over 4% permanently – an increase deemed unlikelyideas.repec.org. This prediction reflected the added costs COOL would impose (segregating and tracking cattle by origin) against uncertain consumer willingness to pay more for “Product of USA” labels.

Post-implementation research confirms U.S. beef producers did not receive higher prices due to COOL. A comprehensive 2015 USDA-commissioned study found “no evidence of meat demand increases” for COOL-covered beef products, meaning U.S. consumers did not buy more (or pay more for) domestic beef because of origin labelsksre.k-state.edu. Without a demand boost, the costs of COOL compliance translated into net economic losses for the cattle/beef industry. Using economic models, that study estimated the COOL rule from 2009–2013 caused about an $8.07 billion reduction in beef industry producer surplus over ten yearsksre.k-state.edu. In other words, beef producers’ profits were lower with COOL – a result of higher operating and segregation costs that were not offset by any price premium. Researchers calculated that retail demand for labeled U.S. beef would have needed to jump 6.8% (for covered products) to avoid hurting cattle producers, but such a demand increase never materializedksre.k-state.edu.

Several factors contributed to this outcome. Consumer surveys and sales data show most U.S. shoppers were unaware of or indifferent to origin labels for meat, so they didn’t change purchasing behavior in ways that would bid up domestic cattle pricesagmanager.infoagmanager.info. At the same time, packing plants and feedlots faced new record-keeping and segregation protocols to keep Canadian/Mexican-origin cattle separate, raising their costs. Industry analyses noted these compliance costs “arise at every stage of the livestock and meat supply chain”, from ranch through feedlot to processorfiles.pca-cpa.orgfiles.pca-cpa.org. If producers had to bear part of these costs (for instance, via slightly lower cattle bids from packers), their net prices would fall. Indeed, the consensus among agricultural economists by the mid-2010s was that COOL had detrimental effects on U.S. beef producers (and added costs for consumers)jaysonlusk.com. No robust study has found a sustained increase in cattle prices attributable to COOL – any theoretical willingness-to-pay premium for U.S. beef was too small or too isolated to shift the overall marketjaysonlusk.comagmanager.info.

However, COOL did alter cattle market dynamics in specific ways, particularly in relation to imported cattle. Econometric research by Pouliot and Sumner (published 2014) found that mandatory COOL led to a widening price spread (basis) between U.S. cattle and Canadian cattle and a corresponding drop in cattle importsarefiles.ucdavis.eduarefiles.ucdavis.edu. According to their analysis, before COOL a Canadian feeder or fed steer sold for about $9–10 per cwt less than a comparable U.S. steer (a normal basis reflecting transport and other factors). After COOL, the price gap widened significantly – by an estimated 33% to 83% larger differential than before, meaning Canadian-origin cattle had to be priced even lower to sell in the U.S.arefiles.ucdavis.edu. They also found the share of U.S. cattle supply coming from Canadian imports dropped (e.g. fed cattle imports fell by roughly 18–33% as a proportion of domestic use) under COOLarefiles.ucdavis.edu. This implies U.S. packers adjusted their behavior: many reduced purchases of imported cattle or paid those imports less, likely because segregating foreign animals for label compliance raised their processing costsarefiles.ucdavis.eduarefiles.ucdavis.edu. In effect, COOL created a market advantage for U.S.-born cattle by making imported cattle less competitive, which could theoretically bolster U.S. cattle prices. Did U.S. ranchers actually gain? In practice, any such price lift was modest and hard to distinguish from other market forces. The overall cattle price trends during 2009–2014 were dominated by supply-and-demand fundamentals (recession impacts, drought herd liquidation, feed costs, etc.), not labeling. Notably, when U.S. cattle prices hit record highs in 2014–15, analysts attributed this to a cyclical supply shortage rather than COOL, and the subsequent price drop in 2015–2016 coincided with herd rebuilding and larger cattle supply – not merely the policy’s repealjaysonlusk.comjaysonlusk.com. The graph below illustrates how cattle prices peaked in 2014 and then fell sharply as the cattle inventory recovered, regardless of COOL status:

Figure: Weekly U.S. fed steer price (blue, left axis) vs. number of fed steers marketed (red, right axis), 2000–2016. The vertical line marks when COOL enforcement ended (late 2015). Cattle prices began falling after 2015, mainly due to a surge in supply (red line); economists concluded this price decline was driven by the cattle cycle rather than the removal of labelsjaysonlusk.comjaysonlusk.com.

Contrary Evidence: It should be noted that not all analysts saw a negative impact on cattle prices from COOL. At least one independent econometric study (Taylor, 2015) argued that COOL did not significantly affect U.S. cattle prices or imports, after controlling for other factorsfarmandfoodfile.comfarmandfoodfile.com. Using detailed transaction data, Taylor found no statistically significant difference in the price paid for imported vs. domestic slaughter cattle attributable to COOL – in fact, he reported that the price basis for Canadian cattle narrowed (improved) in the six years after COOL compared to the prior four yearsfarmandfoodfile.com. His analysis attributed the decline in cattle imports during 2008–2014 to economic conditions (recession, exchange rates, feed costs) rather than the labeling lawfarmandfoodfile.comfarmandfoodfile.com. These findings were put forward during WTO disputes to counter claims that COOL had harmed Canadian exporters. Most other studies, however, dispute this benign view, citing methodological issues, and maintain that COOL’s implementation did create a competitive disadvantage for imported cattle (as the WTO ultimately concluded)arefiles.ucdavis.edufarmandfoodfile.com. Even if one assumes COOL itself didn’t drag down U.S. cattle prices, the key takeaway is that it failed to measurably boost U.S. beef producer pricesin any meaningful way. At best, domestic cattle were selling at normal market-driven prices; at worst, producers saw slightly lower net prices once compliance costs were accounted for. In sum, the beef sector did not receive the price or profit benefits that COOL’s proponents had hoped forjaysonlusk.comksre.k-state.edu.

Pork (Hog) Sector: Similar Story – No Price Lift and Added Costs

The U.S. pork industry’s experience under COOL largely paralleled the beef sector’s outcome. Mandatory origin labeling applied to fresh pork at retail (e.g. grocery store cuts of pork had to list origin of the hogs), but, like beef, consumer demand for pork did not increase due to COOL. The 2015 USDA-commissioned analysis found no evidence of a demand bump for labeled pork products – U.S. consumers were generally not influenced by COOL when buying pork chops, hams, or baconagmanager.infoagmanager.info. Consistent with this, there was no observable premium in hog prices that could be credited to origin labels.

Meanwhile, pork packers and processors faced compliance expenses akin to beef packers – needing to segregate and document hogs born in Canada vs. the U.S., for example. The pork sector is somewhat more vertically integrated than beef and a large portion of U.S. hogs are domestic, but it still relied on imports of live pigs (especially feeder pigs from Canada) that had to be tracked under COOL. These added costs, without higher revenues, translated into a net economic loss for U.S. hog producers. The same economic study (Tonsor, Schroeder, Parcell 2015) estimated the pork industry lost about $1.3 billion over 10 years in producer welfare due to COOLksre.k-state.edu. In other words, pig farmers’ and pork processors’ profits were lower with the labeling law in place. Model simulations showed that to avoid losses, retail demand for COOL-covered pork would have needed to rise by about 5.6%, which did not happenksre.k-state.edu. Instead, COOL raised pork production costs and retail prices slightly, leading to lower quantities sold and lower producer surplusksre.k-state.eduksre.k-state.edu. This mirrors the beef sector result: without consumers paying more or buying more U.S. pork because of labels, any costs imposed by the rule simply eroded industry margins.

Research on trade flows and prices in the hog market also indicates COOL caused adjustments. Canada, like in cattle, was a major supplier of live hogs to U.S. finishers and packers. Studies by Canadian agricultural economists found evidence that COOL depressed the price of Canadian hogs and altered hog trade patterns. For example, Rude et al. (2010, 2016) documented that U.S. imports of Canadian feeder pigs and slaughter hogs dropped after COOL, and Canadian hog prices declined relative to U.S. hog prices concurrently with COOL’s implementationideas.repec.orgideas.repec.org. This suggests U.S. packers were less willing to buy Canadian-origin hogs (or discounted them more heavily) once mandatory labeling kicked in. From the U.S. producer perspective, reducing competition from Canadian imports might sound beneficial. But in reality, there was no clear gain in U.S. hog prices – domestic prices continued to be driven by feed costs, domestic supply, disease outbreaks, and global demand for pork. Any competitive advantage U.S. hogs gained was small and likely offset by higher compliance expenditures in packing plants. As one summary put it, COOL’s requirements led to “lower quantities and higher costs” in the meat supply, causing net losses for both beef and pork sectors without measurable price benefits to farmersksre.k-state.eduksre.k-state.edu.

It’s worth noting that pork was somewhat less exposed to COOL than beef in percentage terms – only about 16% of total U.S. pork production was sold in forms requiring COOL labels (since restaurants and many processed pork items were exempt), compared to roughly one-third of beef production affected at retailksre.k-state.edu. This means a majority of U.S. pork (e.g. bacon in foodservice, ham in processed products, etc.) wasn’t label-regulated, potentially muting the overall impact. Even so, for the portion that was covered, the conclusion from the data is the same: COOL did not increase the prices U.S. hog producers received, and the policy’s costs outweighed its benefits in the pork supply chain. As with beef, no substantial retail premium for “U.S. origin” pork emerged to reward producers. Instead, both industries had to absorb costs or pass them down the line, which effectively reduced producer margins. In summary, COOL failed to deliver a price advantage to American pork producers and in fact slightly hurt their economic outcome, according to the best available analysesksre.k-state.eduksre.k-state.edu.

Chicken (Poultry) Sector: Minimal Disruption and a Modest Benefit

The poultry industry (broiler chicken) had a very different structure and experience with COOL. Like beef and pork, fresh chicken sold at retail was subject to COOL (labels such as “Product of USA” on packages of chicken breast), but nearly all chicken consumed in the U.S. is domestically raised. The U.S. imports only a negligible quantity of chicken meat, and the poultry sector is highly vertically integrated – large companies own or contract the entire production chain from hatching to processing. Because of this, compliance with COOL was relatively straightforward and low-cost for poultry: the origin of chickens was already known and uniform (virtually all U.S. origin), so companies didn’t need complex segregation systems or international sourcing adjustments. USDA analyses noted that COOL implementation costs were “lower for the chicken industry” than for beef or porkagmanager.infoagmanager.info.

What about market effects? Since chicken at U.S. groceries was almost entirely American to begin with, COOL labels on poultry were unlikely to change consumer behavior (there was no major foreign chicken to avoid or prefer). Consistent with other meats, studies found no spike in consumer demand for chicken due to COOLagmanager.info. However, an interesting indirect effect emerged: as beef and pork became slightly more expensive (due to COOL compliance costs passed along) and their retail supply shrank a bit, consumers shifted some of their purchases toward chicken, which was relatively cheaper. This demand substitution was small, but it actually benefited U.S. chicken producers. The 2015 economic analysis calculated that the poultry sector saw a net gain of about $753 million over 10 years thanks to COOL – a narrow gain that partly offset beef/pork lossesksre.k-state.eduksre.k-state.edu. Essentially, poultry producers picked up a little extra business as consumers bought more chicken instead of slightly pricier labeled beef and pork. The gain was modest (on the order of $75 million per year industry-wide, a drop in the bucket for the multi-billion-dollar poultry sector) and “narrow compared to the billions in losses” in red meat sectorsksre.k-state.edu. A further $67 million incremental gain was projected from the 2013 rule enhancement, bringing total poultry benefit to about $820 million over a decadeksre.k-state.edu.

Importantly, these poultry gains did not come from any premium pricing for U.S.-labeled chicken – they arose because chicken’s competitive position improved once beef and pork faced higher costs. In fact, analysts noted the poultry sector’s advantage under COOL stemmed from its streamlined supply chain and lack of international sourcingksre.k-state.eduksre.k-state.edu. Chicken companies didn’t need to change much to comply (no multi-country recordkeeping), so their cost per pound stayed nearly the same while beef and pork costs rose slightly, effectively making chicken a more attractive buy for retailers and consumers. Thus, COOL’s outcome differed by species: it hurt cattle and hog producers financially, while somewhat helping the poultry industryksre.k-state.eduksre.k-state.edu. This reflects the different supply chain structures – vertically integrated, domestically sourced poultry versus more open, international beef and pork supply chains.

Packer, Retail, and Supply Chain Effects under COOL

Beyond producer prices alone, researchers have evaluated how COOL influenced meat packers, retailers, and supply chain dynamics. Mandatory labeling imposed new logistical requirements on packers: slaughter plants had to keep track of an animal’s origin throughout processing and ensure that labels on meat packages accurately reflected that origin (e.g. “Born in Mexico, Raised and Slaughtered in USA” for imported feeder cattle finished here). To manage this, many packers implemented segregation in slaughter runs (dedicating certain days or lots to Canadian cattle vs. U.S. cattle) or paperwork systems to identify meat originarefiles.ucdavis.eduarefiles.ucdavis.edu. These changes increased packers’ operating costs. Evidence also suggests packers altered procurement behavior in response to COOL – for instance, reducing purchases of Canadian cattle and hogs or offering lower prices for them to offset the extra hasslearefiles.ucdavis.eduarefiles.ucdavis.edu. The drop in U.S. imports of live livestock from Canada after 2008–2009 (apart from one-time factors like animal disease events) has been partly attributed to COOL-induced costs making those imports less attractivearefiles.ucdavis.eduarefiles.ucdavis.edu. Some smaller packing facilities or feedlots might have opted out of handling foreign-origin animals entirely to avoid compliance complexity, effectively narrowing market opportunities for Canadian/Mexican producers (while not noticeably raising U.S. farm prices).

At the retail level, COOL meant grocery stores had to display country-of-origin info on fresh meat packages. This gave retailers an added recordkeeping burden (maintaining origin information from suppliers) and slightly higher costs on labeling and inventory management. Retailers generally passed through these costs in the form of marginally higher meat prices for consumersksre.k-state.eduksre.k-state.edu. According to the USDA study, consumers paid more and bought a bit less meat each year under COOL – resulting in an estimated $5.98 billion loss to beef consumers and $1.79 billion loss to pork consumers over 10 years (due to those higher retail prices and reduced consumption)ksre.k-state.eduksre.k-state.edu. In effect, COOL acted like a small price increase tax on meat. However, retailers did not report any significant change in marketing strategies or markups beyond covering these costs – there’s no sign supermarkets used “Product of USA” as a premium branding to charge extra, likely because consumer surveys showed origin info wasn’t a top priority for most shoppersagmanager.infoagmanager.info. Thus, while retail meat prices rose slightly, the increase was to cover compliance costs rather than to boost farmer revenues.

In terms of supply chain participation and structure, COOL highlighted differences between industries. The vertically integrated nature of poultry made it relatively easy to comply (the same firm controls the bird from farm to store, simplifying labeling), whereas the fragmented cattle industry (with cow-calf producers, feedlots, and packers often as separate entities) had to coordinate extensively to track origin, and the hog industry fell in between. Some economists have pointed out that if a less onerous labeling system (e.g. voluntary or North America-wide labeling) were used, it could achieve origin information with fewer costsagmanager.infoagmanager.info. In fact, research found consumers valued a “Product of North America” label about the same as “Product of USA”, suggesting a continental label could have been a cheaper compromise with little perceived differenceagmanager.infoagmanager.info. Such insights underscore that the stringency of COOL (differentiating even between U.S. and Canadian origin) added complexity without commensurate consumer benefit.

Finally, once COOL for meat was repealed (late 2015 for beef and pork), industry observers looked for any drastic changes. Some U.S. ranchers initially blamed falling cattle prices in 2016 on COOL’s repeal, believing the end of labels invited a flood of cheaper imports that undercut domestic pricesjaysonlusk.comjaysonlusk.com. This view, however, is not supported by data: analysis shows the cattle price drop was driven mainly by the post-drought expansion of the U.S. herd (increased supply), and import numbers from Canada/Mexico rose only modestly within normal ranges after repealjaysonlusk.comjaysonlusk.com. In fact, one economic review found that cattle prices fell less than expected given the surge in supply, implying repeal was not the culpritjaysonlusk.comjaysonlusk.com. Packer behavior post-repeal presumably relaxed (less segregation needed), and U.S. meat exports avoided retaliatory tariffs that would have been imposed had COOL continued (the repeal was driven by WTO trade dispute outcomes). Thus, the removal of COOL did not drastically alter producer prices either – it mainly prevented trade retaliation and eliminated the compliance costs moving forward. The overall lesson from the COOL experiment is that labeling origin did not deliver meaningful price premiums to U.S. beef and pork producers, and any subtle market advantages (like reduced import competition) were outweighed by higher costs and lost efficiencyksre.k-state.eduksre.k-state.edu. Only the chicken industry saw a slight benefit, thanks to its unique structure and consumers shifting to poultry when red meat prices rose.

Conclusion

From 2000 onward, a robust body of academic research, government reports, and industry analyses has evaluated COOL’s impact on U.S. meat producer prices. The consistent finding is that mandatory COOL had no positive effect on the prices received by American beef and pork producers. Studies found no increase in domestic demand or willingness to pay sufficient to boost farm pricesagmanager.infoagmanager.info. Instead, COOL introduced additional supply chain costs and trade frictions that, if anything, put downward pressure on producer margins or caused net welfare losses in those industriesksre.k-state.edujaysonlusk.com. Beef and pork sector outcomes were negative or neutral – with one estimate of a combined $9+ billion producer loss over a decadeksre.k-state.edu – while the highly integrated chicken sector reaped a small gain by capturing consumer substitutionsksre.k-state.edu. Crucially, no reliable evidence shows COOL raised U.S. producer prices for cattle or hogs, and any claims to the contrary have been largely refuted by empirical data (which point to larger market forces driving price changes)jaysonlusk.comjaysonlusk.com. Differences in supply chain structure played a role: the vertically integrated poultry industry navigated COOL with ease and even benefit, whereas the multi-layered beef and pork chains incurred higher costs and saw no compensating price premiumksre.k-state.eduagmanager.info. COOL’s implementation also influenced packer procurement (reducing imports, segregating livestock) and retail pricing (slightly higher prices to cover costs), but these changes did not translate into higher farm-gate prices for U.S. producers in the COOL-covered sectorsarefiles.ucdavis.eduksre.k-state.edu. In sum, the research consensus is that mandatory country-of-origin labeling did not achieve its intended economic benefit for American beef and pork producers – it neither raised the prices they received nor strengthened demand in a measurable way, and in fact tended to either leave producer prices unchanged or modestly lower after accounting for costsksre.k-state.eduksre.k-state.edu. The only notable positive outcome was a minor boost to the U.S. poultry industry due to consumers switching to chicken when COOL made red meats slightly more expensiveksre.k-state.edu. All these findings suggest that while COOL satisfied consumer “right to know” considerations, it fell short as a tool for improving U.S. producer price levels, instead reshaping supply chain behavior and prompting trade disputes without delivering a clear financial upside to farmers.

Sources: Academic and government studies on COOL’s economic impactksre.k-state.eduagmanager.infoarefiles.ucdavis.eduksre.k-state.edu, USDA Economic Research Service and Chief Economist reports, industry analyses, and WTO dispute records.