The Effects of Mandatory Country-of-Origin Labeling on Canadian/U.S. Live Hog and Feeder Pig Trade

Abstract

The final implementation of Mandatory Country-of-Origin Labeling has caused some U.S. packing plants and finishing operations to discontinue using Canadian live hogs and feeder pigs in their operations thereby reducing trade. Using a system of simultaneous equations representing U.S. import demand and U.S. price, this thesis estimates the reduction in trade and any possible price effects in both live hogs and feeder pigs associated with the implementation of the final rule of Mandatory Country of Origin Labeling in the United States. It was found that the implementation of Mandatory Country of Origin Labeling reduced the trade of live hogs between the United States and Canada by 37.8 percent. The reduction in feeder pigs was 24.1 percent. It was also found that the implementation of Mandatory Country of Origin Labeling had no effect on the price of both live hogs and feeder pigs in the U.S. market.