In March 2024, the United States Department of Agriculture (USDA) finalized its rule regarding the voluntary use of the labeling terms “Product of USA” and “Made in the USA.” This new rule establishes a requirement that must be met in order for a meat, poultry or egg product to bear a label claiming the product is of U.S.-origin. Under the new rule, a product must be derived from an animal born, raised, slaughtered, and processed in the U.S. in order to bear the label “Product of USA” or “Made in the USA.” The rule establishes requirements for both single and multi-ingredient products, and creates standards for U.S.-origin labels claiming that components of a product’s preparation or processing occurred in the U.S. The rule does not establish a mandatory U.S.-origin label, but rather creates an opportunity for a voluntary claim of a product’s U.S.-origin if the requirements are met.

USDA regulation and generic labeling

In the U.S., the labeling of meat, poultry, and egg products is regulated by USDA’s Food Safety Inspection Service (FSIS). The authority of FSIS to regulate those products is found in the Federal Meat Inspection Act, the Poultry Products Inspection Act, and the Egg Products Inspection Act. Under these acts, FSIS is required to approve the labels of meat, poultry, and egg products. However, FSIS does have a process for the “approval of generic labels.” 9 C.F.R. § 412.2. Under this process, labels that qualify are authorized for use on FSIS regulated products without prior submission and approval from FSIS. Generically approved labels are required to bear mandatory labeling features such as, product name, ingredients statement, and nutrition labeling. The new “Product of USA” voluntary rule will qualify as a generically approved label. For more information on Food Labeling generally, click here to view NALC Food Labeling reading room.

Background of U.S.-origin label claims

The previous rule for U.S.-origin claims is found in the FSIS Food Standards and Learning Policy Book. It allowed the label “Product of USA” on products processed in the U.S. if the country where the product is exported to requires it, or if the product was processed in the U.S. This meant that food products made from animals born, raised, and slaughtered in foreign countries could bear the label “Product of USA” if the product was processed in the U.S. For example, products made from cattle born, raised, and slaughtered in Brazil, but shipped to the U.S. for processing could bear the label “Product of USA” even though the animal never stepped foot on U.S. soil while alive. Many stakeholders were unhappy with this rule and felt that it created a loophole that confused consumers and was unfair to smaller American producers.

There were a number of catalysts that prompted the USDA to make the rule change. Between 2018 and 2021, three petitions regarding the “Product of USA” label were sent to USDA from the following industry associations: the American Grassfed Association and Organization for Competitive Markets (AGA/ OCM), United States Cattlemen’s Association, and National Cattlemen’s Beef Association. Click here to read NALC Issue Brief “Petition for Policy Change in FSIS’ ‘Product of USA’ Label” concerning the AGA/OCM petition. Along with the industry association petitions, in 2021, the Biden Administration issued an Executive Order urging the Secretary of Agriculture to update the rules regarding the voluntary “Product of USA” label. Additionally, in 2022, FSIS conducted a consumer web-based survey on “Product of USA” Labeling. The survey showed that 47% of surveyed consumers incorrectly understood the “Product of USA” label to mean the animal was born, raised, slaughtered, and processed in the U.S. Surveyed consumers also indicated that they do value “Product of USA” label claims, and were willing to pay more for a product when all preparation and processing steps occurred in the U.S. The rule was proposed by USDA in March 2023, and is now finalized after a period of public comment.

Final Rule

Approval of U.S.-origin generic label claims

The new rule creates requirements for the use of voluntary U.S.-origin label claims. Under the new rule, voluntary “Product of USA” or “Made in the USA” labels are allowed only on meat, poultry, and egg products when they are derived from animals born, raised, slaughtered, and processed in the U.S. Specifically, for a single ingredient product the claims “Product of USA” or “Made in the USA” may be used under FSIS generic approval on labels to indicate a product derived from an animal born, raised, slaughtered, and processed in the U.S. “Product of USA” and “Made in the USA” claims may also be used on the labels of multi-ingredient products if 1) all FSIS-regulated products are derived from an animal born, raised, slaughtered, and processed in the U.S.; 2) all other ingredients in the product are of domestic origin; and 3) the preparation and processing steps for the multi-ingredient product have occurred in the U.S. The rule makes an exception for spices and flavorings, allowing the inclusion of spices and flavorings of foreign origin.  For example, a single ingredient product, such as steak, will be allowed to bear the “Product of USA” label if it is derived from cattle that was born, raised, slaughtered, and processed in the U.S. Similarly, a multi-ingredient product like pork sausage will be allowed to bear the “Product of USA” label if the meat and other ingredients regulated by FSIS are derived from an animal born, raised, slaughtered, and processed in the U.S., all other ingredients in the product, other than spices and flavorings, are of U.S. origin, and the preparation and processing steps occurred in the U.S.

Other U.S.-origin claims

Under the new rule, U.S.-origin claims other than “Product of USA” and “Made in the USA” may be used for generic approval on labels of single and multi-ingredient products when a component of the preparation and processing occurred in the U.S. To use U.S.-origin claims other than “Product of USA” and “Made in the USA,” a label must include a description of the preparation and processing steps that occurred in the U.S. For example, a pork product derived from an animal born, raised, and slaughtered in a foreign country, but processed in the U.S. could bear a label stating, “Packaged in the United States using imported pork.” Additionally, single and multi-ingredient products may bear a U.S. State, territory, or locality-origin claim to both indicate the product’s origin or a component of the preparation and processing steps which occurred in the U.S. State, territory, or locality. Products will only be allowed to make these claims if the requirements set forth for U.S.-origin claims and for U.S. preparation and processing component claims are met. For example, a claim referring to the origin of a meat product bearing the label “Product of Arkansas” must be derived from an animal born, raised, slaughtered, and processed in Arkansas. Similarly, a meat product derived from an animal born, raised, and slaughtered in a foreign country, but sliced and packaged in Alabama may bear a label claiming “Sliced and packaged in Alabama.”

Use of flag

Under the rule, the U.S. flag or a U.S. State or territory flag may be used for both an origin claim, or a component of preparation and processing claim on a single or multi-ingredient product. To use the U.S. flag or U.S. State or territory flag for a claim, the product must meet the requirements set forth for “Product of USA” or “Made in the USA” claims, or preparation and processing component claims. To use the flag imagery for a claim relating to a component of preparation or processing that occurred in the U.S., the imagery must be accompanied by a statement describing the steps.

Geographical Significance Labeling

The rule also requires that products bearing a label of geographical significance must comply with the requirements created for voluntary U.S.-origin claims. 9 C.F.R. § 317.8(b)(1) is modified to require that product labels using “statements, words, pictures, designs, or devices” referencing a locality with geographical significance other than the locality where the animal was born, raised, slaughtered, and processed must be qualified by the word “style,” “type,” or “brand.” For example, a hot dog that is “New York-style,” but does not meet the requirements for a multi-ingredient product to bear a “Product of New York” claim can still use the words “New York” in its label as long as it is accompanied by the word “style.” The rule also amends 9 C.F.R. § 381.129(b)(2) to apply the same standard to poultry products.

Country of Origin Labeling

This is not the first time the U.S. has attempted to address origin claims on meat and poultry product labels. In the 2002 Farm Bill, Congress amended the Agricultural Marketing Act of 1946 to require country-of-origin labeling (COOL) at the retail level for fresh fruits and vegetables, peanuts, pecans, macadamia nuts, ginseng, fish, shellfish, and ground and muscle cuts of beefs, lamb, and pork. Following the final COOL rule implementation in 2009, Canada and Mexico challenged the rule, specifically the provisions regarding beef and pork, in a World Trade Organization (WTO) dispute settlement case. Canada and Mexico alleged that COOL distorted trade by treating U.S. livestock more favorably than imported livestock. After years of dispute before different WTO panels, it was determined that COOL violated U.S. WTO obligations. As a result, Congress repealed beef, pork, ground beef and ground pork COOL requirements, and the USDA published a final rule amending the COOL regulations to comply. To read more about COOL, click here to visit NALC COOL reading room.

The new “Product of USA” rule differs from COOL because it is a voluntary label claim. However, this distinction has not stopped Mexico and Canada from voicing concern about potential trade impacts. In a statement released by its Ministry of Economy, Mexico “rejects” the rule, and claims that it would “create barriers in binational production chains.” Mexico alleges the rule is contrary to the “principles of . . . the United States-Mexico-Canada Agreement (USMCA).” Mexico prefers to resolve the issue through constructive dialogue with the U.S. but is open to the use of both USMCA and WTO mechanisms to ensure the U.S. complies with its trade commitments. Canada reacted by releasing a joint statement from both its Minster of Agriculture and Agri-Food and Minster of Export Promotion, International Trade and Economic Development. The statement highlights their disappointment in the final rule, and their intention to raise the issue at a trilateral meeting with both the U.S. and Mexico’s agriculture ministers later this month.

Conclusion

The USDA final rule will require that meat, poultry, and egg products bearing a “Product of USA” or “Made in the USA” label must be derived from an animal born, raised, slaughtered, and processed in the U.S. The rule also provides requirements for the use of a U.S.-origin label claiming a component of the product’s preparation and processing occurred in the U.S. Though the rule is voluntary, Mexico and Canada have already expressed concern with its trade impacts. The rule is effective on May 17, 2024, and products choosing to use voluntary U.S.-origin claims must comply by January 1, 2026.

For more information on the COOL WTO dispute with Mexico and Canada, click here for CRS Report “Country-of-Origin Labeling for Foods and the WTO Trade Dispute on Meat Labeling”