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US Finishers Expect Duty on Canadian Hogs to Remain in Place

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

CANADA - Farm-Scape: Episode 1649. Farm-Scape is a Wonderworks Canada production and is distributed courtesy of Manitoba Pork Council and Sask Pork.

Farm-Scape, Episode 1649

A University of Missouri Agricultural Economist says most American swine producers who buy Canadian feeder pigs expect the duty on those pigs to remain in effect for a year or so.

Last month the US Commerce Department imposed a 14.06 percent preliminary antidumping duty on the majority of live Canadian slaughter hogs and feeder pigs entering the US.

University of Missouri Agricultural Economics Professor Dr. Ronald Plain, on hand yesterday for Pork Symposium 2004 in Saskatoon, says the first week of data does show a decline in the number of hogs crossing the border.

"If you look at the hogs coming south, about one third of them are slaughter hogs, about two thirds are feeder pigs.

For the one third that go to slaughter, I'm not sure that it makes much difference to the packers. By en large the tax paid by the producers bringing them across the border.

There has been maybe a bit of decline in slaughter in the US. The big impact will likely be on the feeder pig producers because they've finishing floors and they become dependent on those pigs coming south.

For a lot of those guys, they're going to continue to buy Canadian pigs and it's going to be a little bit more expensive than it was before.

Most hog finishers have some sort of relationship with their farrowing unit where they get their pigs so it's a little bit tough to quickly switch to a different source.

In this situation you've got a large number of US finishers that suddenly would be trying to make a switch to US supplied feeder pigs all at once so it's not very likely that they're going to find an extra supply of pigs in the States.

I think most of them are going to continue to feed Canadian born pigs and pay the extra costs. In some cases we're hearing talk of sharing the tariff between the US finisher and the Canadian producer. Exactly how that's going to fall out, I don't know."

Dr. Plain says we'll known in March if the tariff will become permanent or be eliminated but, at this point, most US producers expect the duty to stand for awhile at least.

For Farmscape.Ca, I'm Bruce Cochrane.

5m Editor