February 26, 2003

A white paper issued today by the American Frozen Food Institute (AFFI) describes specific scenarios under a country of origin labeling regulation that it says would dissuade frozen food makers from using domestic produce and seafood, and from housing product blending facilities within the United States.

Leslie G. Sarasin, CAE, AFFI's president and chief executive office, said at issue is a new country of origin marking scheme for some food products that departs dramatically from long-standing provisions of the Tariff Act of 1930. USDA issued new voluntary marking guidelines in October 2002, as required in the 2002 farm law. The law directs USDA to issue a final new mandatory marking regulation in 2004.

The paper is a compilation of case studies, consumer research and insights that support AFFI's case that the new marking scheme could create unintended consequences. Feared effects include disincentives to maintaining frozen produce and frozen seafood facilities in the United States, as well as disincentives to source domestic produce and seafood for further processing.

AFFI cites examples showing that the presence of certain processing operations within the United States and the use of domestic ingredients can subject food products to marking requirements that are significantly more complex and costly than those that would apply if the products were processed in other countries, or did not contain domestic ingredients.

The paper was issued during its 2003 Western Frozen Food Convention in San Diego, CA. AFFI said it "urges Congress to hold hearings to identify actions necessary to mitigate the negative consequences identified in this white paper, as well as other consequences identified by members of the Food Industry Trade Coalition." AFFI chairs the Food Industry Trade Coalition, a coalition of food processors, retailers and producers that seeks to expand overseas markets for U.S. products and opposes trade-distorting measures in the U.S.

"It is AFFI's view that the severity and validity of the feared consequences necessitate remedial actions, potentially including repeal of the new country of origin marking scheme; promotion of an enhanced voluntary marking program rather than issuance of a new regulation in 2004, with the understanding that the voluntary program that resulted from the Farm Bill is not suitable; or, at the very least, elimination of the duplicative marking requirements on food products," AFFI said.

In addition to detailed descriptions of the treatment of various food products under the new marking scheme, AFFI's paper includes the results of a new consumer survey conducted independently for AFFI by Opinion Research Corporation in January. When asked to identify factors that affect their purchasing decisions related to frozen fruits and vegetables, fewer than 1% of respondents indicated a response related to the "country where a product is from."

The complete White Paper is available online at http://www.affi.com.