Last week the European Union introduced export refunds for fresh and frozen pig meat to help ease difficulties faced by producers as a result of declining profits.

Canadian Pork Council executive director Martin Rice says the refunds, which cover all cuts of fresh and frozen pork and range as high as 75 cents per kilogram, will have a huge impact on the returns received by Canadian producers in the markets in which they compete.

Martin Rice-Canadian Pork Council

The market I guess we see each other the most in would be Japan but, in the last few years, I would say Korea, Australia, Russia are all very important markets and indeed there is nothing to suggest that these subsidies are not available for them to ship to the United States and it seems to be unlimited.

These are all major markets for us and very important to determining the price paid for Canadian pigs.

And indeed this is not just for the basic muscle cuts.

We are looking at offals, the specialty products such as livers and hearts and so on which are high value products in China and other parts of Asia and once again it's less return that we can receive for the carcass.

Rice notes the CPC is assessing the legality of the EU subsidies and is working with the Canadian government and its missions abroad to determine avenues for a more formal protest or possible trade action.

He says, at the minimum it will be necessary to voice Canada's discontent with the decision, particularly when efforts are underway to work out a new trade agreement under the WTO.

Last week the European Union announced the introduction of export refunds on pork and pork products.

National Pork Producers Council vice president and council International Trade Policy Nick Giordano says exports have been a bright star for the U.S. pork industry disproportionately contributing to producers profitability and these subsidies will impact those exports.

Nick Giordano-National Pork Producers Council

It underscores the need for the U.S. and Canada and the community of nations to finish the Doha Round.

The European Union has agreed to terminate its export subsidies as a deliverable under in the Doha Round.

However the Doha deal has not been concluded and I think everybody needs to roll up their sleeves and work a little harder to get a deal done.

Of course for the pork industry we're looking not just for the termination of export subsidies which in and of itself will be very important but also we're looking to a very ambitious market access package for pork hopefully in the European Union and in other countries.

We need to, as industry, continue to work closely with our governments to ensure that we get a successful conclusion to the Doha Round.

When we get that we will get the termination of export subsidies from the European Union, more disciplines on governments intervention and markets and more open markets.

Giordano says, while the subsidies are legal under the Uruguay agreement there is always concern when producers in one country are given government support not available in another which impacts the amount of pork produced in the world, impacting prices and sales.

Further Reading

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