Two department officials, speaking on condition of anonymity, said that the estimate shows the food industry and farmers likely will spend $3.3 billion to separate pigs, cattle and sheep before they're slaughtered. Record-keeping would cost another $600 million.
The labels have to say where the animals were born, raised and processed, which would be complicated in cases where livestock was born elsewhere but slaughtered in the United States.
Although that new estimate only includes the cost to the food industry, retailers warn that consumers will end up paying more for their food to pay for the labels.
The department initially said farmers, processors, and supermarkets would spend $2 billion the first year of the program to just keep records of livestock, fresh produce and peanuts as they move through the food chain.
The labels will become mandatory in September of 2004. Packers and retailers have pushed to get the labeling program rolled back ever since President Bush signed it into law last year as part of the farm bill. Earlier this year, the House passed a measure to effectively block it, but Senate lawmakers from farm states want to keep it, arguing consumers would buy U.S. food products instead of imports.