business news in context, analysis with attitude

The Oregonian reports that US food companies will spend $2.5 billion next year complying with the government’s newest country-of-origin food label rules, according to figures released by the US Department of Agriculture (USDA).

“The department's assessment offers some hints of how much more consumers might pay,” the paper writes. “For instance, retailers' implementation costs are pegged at 7 cents a pound for beef and 4 cents a pound for pork. The average individual U.S. producer will shoulder initial costs of $376 and the average U.S. retailer will face initial costs of $26,149, according to the latest estimate … More than 1.2 million U.S. business ‘establishments’ will be ‘either directly or indirectly affected’ by the new labeling requirements, the department estimates.”

KC's View:
I suspect that at least in the beginning, the costs will be high and the immediate benefits will be anything but overwhelming.

On the other hard, for context, it is worth pointing out that the tomato industry just took a $100 million bath when it was incorrectly blamed for the recent salmonella outbreak that sickened more than 1,200 people in 47 states. And while the government currently is blaming the jalapeno pepper industry for the salmonella problem, will anyone be surprised if next week the feds say “never mind,” and blame somebody or something else?