The Rural Voice, 1985-01, Page 20FARM NEWS
ITC rules hog exports injure U.S. farmers
Canada received a major set -back
when the International Trade Com-
mission (ITC) ruled unanimously that
Canadian hog exports have injured
U.S. farmers.
The investigation of hog exports
was initiated by hog farmers in Iowa
who claim that Canada is undercut-
ting their market with exports of
cheap, subsidized hogs.
Perth OMAF swine specialist,
Richard Smelski says part of the
reason U.S. hog producers are upset
with Canadian exports is "just plain
jealousy." Ontario, for example, has
one of the best pork marketing sys-
tems in the entire world.
Many of the Canadian pork subsi-
dies which U.S. pork producers are
unhappy with are not being received
by Ontario pork producers. Some of
the highest Canadian pork subsidies
are being received by Quebec pork
producers.
"What the ITC decision against
Canadian pork exports means in my
mind is that there will be tariffs put
on Canadian pork going to the
U.S.," says Ray Stock, president of
the Perth Pork Producers' Associa-
tion.
If the tariff is two or three cents per
pound, Canadian pork producers
may receive that same amount less
per pound in the market price. How-
ever, if the tariff is as high as six
cents, Smelski doesn't think farmers
will be expected to absorb that high
loss.
He said a tariff would be felt by the
Canadian population in general. A
tariff would mean that money is be-
ing taken from the Canadian pork in-
dustry and directed through the U.S.
treasury. The tariff would make the
Canadian pork industry that much
poorer and the general economy that
much poorer (because of the money
pork producers help circulate in the
economy.)
Smelski says there is very little the
individual farmer can do, with the ex-
ception of writing letters to U.S.
magazines and newspapers and ex-
plaining the position of Ontario pork
producers.
Smelski says the ITC decision does
not necessarily mean there will be a
tariff. It could mean the U.S. have
made their point and may not go as
far as a tariff. They may choose in-
stead to create further export paper
work — the nickel and dime paper
work that creates frustration. The
foreign market outlet could be stif-
fed through frustration rather than
tariffs, says Smelski.
The ITC decision doesn't mean the
U.S. will stop importing Canadian
pork altogether. However, there is no
simple answer for Canadian pork
producers. It's not as easy as finding
another export market, says Stock.
The United States is really the only
market to which Canadians can ship
live hogs. We can't kill all the hogs
we've got in Canada now," explains
Stock. The U.S. slaughters and packs
the surplus Canadian pork. The
Canadian packing industry is reluc-
tant to invest high capital cost to ex-
pand in Canada because the enter-
prise is not a profitable one. The
higher wages in Canadian packing
plants compared to the U.S. make the
industry less profitable here.
(Unionized packers get as much as $5
per hour more in Canada.)
Therefore, the inability to create box-
ed meats severely limits Canadian ex-
port opportunities, says Stock.
"The time has probably arrived
that we must establish our own killing
plant," Stock says. He can't see why
the OPPMB can't help finance a kill-
ing plant and sell directly to the pro-
cessing industry.
To him, the ITC decision means its
"foolhardy" right now for local hog
farmers to expand. He says survival
of the individual farmer depends par-
tially on personal efficiency. It means
that a farmer can produce the same
number of weaners with 50 to 60 sows
rather than with 70 to 80 sows if herd
health and management are at its
best. Stock feels it would be a step in
the right direction to depopulate poor
herds. He said this recommendation
was given to Ontario Minister of
Agriculture and Food Dennis Tim-
brell, when he visited a small number
of Perth pork producers in Nov-
ember, 1984. Stock emphasized that a
producer obviously would have to
receive adequate financial incentive
to depopulate his herd for the benefit
of herd health in general. He would
need money to rebuild a healthy herd.
Pork producers have been assured
by Federal Agriculture Minister John
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18 THE RURAL VOICE
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voi
HAMPSHIRE LANDRACE & HYBRIDS
Wishing
Our Customers .
a Happy
and
Prosperous
1985
Best wishes from
Thames Bend Farms &
Staff