U.S. Trade Action unfair to Canadian hog producers

by 5m Editor
19 October 2004, at 12:00am

CANADA - Alberta pork producers will at least temporarily face just over 14 percent higher costs for shipping hogs to the U.S. as a result of last week’s trade action announced by the U.S. Department of Commerce, says the Jack Moerman, Chairman of Alberta Pork. The 14.06 percent dumping duty deposit will be paid by the importer of record.

Alberta Pork

The anti-dumping duty is charged only on live hogs exported to the U.S. and should have no Canadian price consequences. Alberta Pork will be closely monitoring the pricing of hogs in Western Canada during this initial and preliminary anti-dumping time frame. Alberta Pork is prepared to take action if Alberta producers are unfairly treated.

“Those duties will hurt both Canadian and U.S. producers,“ says Moerman, a Gibbons, Alta. producer, “Alberta Pork is vigorously supporting our national counterpart, the Canadian Pork Council in its efforts to demonstrate that Canadian pigs are not injuring the U.S. but rather contributing to the success of the entire North American hog sector.“

The North American hog industry has been very successful as a result of free trade and this unfortunate decision erodes that advantage, says Moerman. In fact the U.S. industry is currently at record high prices, which is why this trade action is so very disappointing to Alberta Pork. “Rather than fighting each other with trade actions, Canadian and U.S. producers should be working together to build an even stronger mutual industry.“

This decision may ultimately be overturned. These preliminary margins will be replaced by final margins, expected in March 2005, when the U.S. Commerce Department makes a final determination. However, these duty deposits collected could be refunded if the U.S International Trade Commission finds that imports of live swine have not injured the U.S. hog industry. Since the possibility of a duty refund exists, producers should make contractual arrangements with their exporters.

The U.S. launched two trade actions in March 2004 investigating subsidies and anti-dumping. A preliminary decision announced in August found that subsidies were not countervailable, which leaves the Canadian industry wondering about the justification for any further trade action.

“We’re hopeful this latest decision will be overturned,“ says Moerman. “Canada and the U.S. operate in the same integrated North American pork market, and Canadian pork producers are no more dumping than are U.S producers. As the Canadian Pork Council has clearly pointed out, all of us function in the same price structure.“

Source: Alberta Pork 18th October 2004

5m Editor