USDA Proposes New “Made in the USA” Standard

U.S. consumers who seek animal food products labeled as “Made in the USA,” or who simply value transparency on food product labels, may finally catch a break. On March 6, 2023, the USDA released a proposed rule to help define what is meant when a food product is a “Product of USA” or “Made in the USA.”  Currently, Food Safety and Inspection Service (FSIS) regulated products may be labeled as “Product of USA” even when an animal product is derived “from animals that may have been born, raised, and slaughtered in another country but are minimally processed in the United States.”

As a result of the U.S. President’s Action Plan for a Fairer, More Competitive, and More Resilient Meat and Poultry Supply Chain, the proposed rule allows a “Product of USA” or “Made in the USA” label claim to be used on meat, poultry and egg products only when they are derived from animals born, raised, slaughtered and processed in the United States.

Albeit, a very significant caveat accompanies the proposed rule, which is, that, labeling a food product in accordance with the latter is completely voluntary. The U.S. Federal Trade Commission (FTC) takes a similar course of action. While the FTC regulates U.S. origin claims under its authority to act against deceptive acts and practices, foreign-origin markings on products are regulated primarily by U.S. Customs under the Tariff Act of 1930. The similarity in the rules is that neither Customs nor the FTC requires that goods made partially or wholly in the U.S. be labeled with “Made in USA” or allude to any other indication of U.S. origin (but, if companies do choose to utilize the claim, the company must be prepared to defend it and ensure it uses it correctly). The exception to this is for textile, wool, and fur products as processing or manufacturing occurring in the U.S. must be disclosed.

In the context of the USDA, such labeling would also remain eligible for generic label approval, eliminating the need to be pre-approved by FSIS before it could be used on regulated products, and incorporates laxed auditing standards for supporting documentation.

Another effect of the proposed rule is forecasted to positively impact those involved with animal husbandry for commercial purposes.  The USDA’s proposed rule bolsters the Packers and Stockyards Act (P&S) of 1921 ‘“to safeguard farmers and ranchers… to protect consumers… and to protect members of the livestock, meat, and poultry industries from unfair, deceptive, unjustly discriminatory and monopolistic practices”’ This is reassuring when taking into account that:

The global beef market is projected to grow from $414.98 billion to $604.34 billion by 2029, at a Compound Annual Growth Rate (CAGR) of 5.52% in forecast period, 2022-2029;
The global poultry market is expected to grow at a CAGR of 7.2% to nearly $465.7 billion by 2025, and at a CAGR of 6.8% to $645.7 billion by 2030; and that,
The global egg market is expected to grow annually by 7.70% (CAGR 2023-2027).

The USDA encourages stakeholders to publicly comment on the proposed rule for the 60-day window after publication of the same at www.regulations.gov. If you have questions or want to make your voice heard, contact info@diaztradelaw.com to discuss how Diaz Trade Law can assist you.

The post USDA Proposes New “Made in the USA” Standard appeared first on Customs & International Trade Law Blog.

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