Speer: Data Indicates COOL is Self-Defeating


By Nevil Speer, Opinion, Drovers  

November 19, 2021


A recent Twitter post highlighted a graph comparing the trend of monthly U.S. fed cattle prices versus the retail cost of beef.  The graph reflected the story of leverage and margin that’s at the forefront of debate and discussion within the industry.  However, the graph wasn’t specifically addressing that issue.  Rather, the purpose was to generate support for COOL including the following statement:


“During the nearly seven years since MCOOL for beef was repealed, U.S. cattle producers experienced lower cattle prices and were deprived the means to build demand for their U.S. produced cattle.”


COOL proponents contend the law provides competitive advantage to U.S. beef producers and enables farmers and ranchers to receive higher prices.   But the tweet failed to paint the broader picture; it didn’t reflect Canadian fed cattle prices that have marched in lockstep with the U.S. market (the correlation is .93). (See chart below.)


With that in mind, we’re left with one of two take-aways...


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US-China phase-one trade deal gets a reality check after nearly two years

USTR Katherine Tai has said the US intends to hold China accountable to the two-year phase-one trade deal while exploring weaknesses in Beijing’s performance

Analysts expect high tariffs to persist in China-US trade in the long term


Ji Siqi, South China Morning Post (China)

21 Nov, 2021


As the two-year deadline for the phase-one trade deal between the world’s two largest economies is approaching, all eyes are on the next step.


Signed in January 2020, the deal was considered a ceasefire agreement between China and the United States following a two-year trade war that originated from a Section 301 investigation by the US in 2018, when Washington said Beijing had engaged in unfair trade practices such as intellectual property (IP) theft and granted excessive government subsidies to a wide range of domestic industries.


The Trump administration first imposed a 25 per cent tariff on US$50 billion worth of Chinese products, then extended the range to US$200 billion. In retaliation, China imposed tariffs ranging from 5 to 25 per cent on various US goods, including agricultural products and vehicles...