The Rural Voice, 1989-11, Page 50NEWS
HURON PORK BOARD OPPOSES LEVY FOR COUNTERVAIL
As The Rural Voice went to press,
Huron County Pork Producers were
taking time out of their busiest season on
the land to respond to a political issue
threatening their livelihood.
A vote by secret ballot was being
held at a meeting in Londesboro Octo-
ber 26 to determine whether the Huron
County Pork Producers Association
(HCPPA) would appeal a decision by
the Ontario Pork Producers Marketing
Board (OPPMB) to charge producers $2
per hog to cover the cost of potential
American countervail duties imposed
on Canadian pork.
HCPPA president Bruce Bergsma
says the county board of directors is
opposed to the levy, and called the vote
for its 1,500 members to get grassroots
support. If that support is forthcoming,
the HCPPA will make a formal appeal to
the OPPMB. If that appeal is turned
down, Bergsma says, the HCPPA will
take the case to the Farm Products
Marketing Tribunal.
"We're prepared to follow this right
through if we get a mandate from our
producers."
Despite a vote of 85 to 70 against the
levy at the semi-annual meeting of the
OPPMB in September, the OPPMB
board of directors later decided to pro-
ceed with a charge of $2 on every pig
shipped as of October 23 for the next six
months. The same decision has been
made by nine other provinces.
The $2 figure, which could go
higher, was set to cover any duty im-
posed above the 3.6 cents a pound duty
placed in September on Canadian ex-
ports of pork to the U.S. Canadian
producers fear that an additional amount
of about 7 cents maybe added in 12 to 18
months, when the duty is reviewed. The
OPPMB has decided to cover the duty
because Canadian packers who export
to the U.S. have indicated that increas-
ing duties may prevent them from ex-
porting to U.S. markets in the future.
Bergsma says that while the OPPMB
board of directors has the power to make
that decision, he wonders why county
representatives waste their time at meet-
ings in Toronto. He adds that county
representatives weren't given time to
take the issue back to their county and
discuss it with their councilmen.
48 THE RURAL VOICE
The U.S. charges that Canadian pork
exports are unfairly subsidized, and its
International Trade Commission im-
posed the countervail September 13.
The Canadian Pork Council is pursuing
a review of the U.S. judgement under
Chapter 19 of the Free Trade Agree-
ment, but this will take months.
"We're subsidizing the
packers," Bergsma says,
"Why should we pick
up their tab?"
In Perth County, pork producers are
generally in support of the OPPMB
board decision, says Arnold Van
Moorsel, head of the Perth County Pork
Producers Communications Commit-
tee. Some producers in Perth were
annoyed by the fact that the OPPMB
board reversed the decision of the gen-
eral OPPMB body at the semi-annual,
he says, and some Perth members might
support Huron County's position, but
the PCPPA as an organization believes
the Ontario board is in the best position
to judge the long-term consequences
involved in the issue.
"It's a pretty touchy subject, that's
for sure," Van Moorsel says.
He adds two points. One, because
the countervail is a national issue, it is
difficult for individual members to as-
sess. Two, if an increased countervail
duty is imposed and later reversed, and
the producers have been paying for it di-
rectly, then producers will be reim-
bursed. But if the packers absorb addi-
tional countervail costs and the counter-
vail is reversed, the packers would get
the money back but probably wouldn't
pass the saving on to producers.
Bruce Bergsma, however, says that a
levy paid by producers to cover the
countervail could also be seen as
countervailable by the U.S. "We're
subsidizing the packers," he says.
Bergsma compares producers pay-
ing for countervail duties to the packers
handing pork producers their Hydro bill.
"Why should we pick up their tab?"
Bergsma also notes that pork producers
do finance research and promotion that
benefits packers, and says that produc-
ers will end up paying for countervail
"one way or the other" anyway.
Bergsma says he's been told that if
producers don't pay the countervail
levy, they could lose as much as 10 to 20
dollars a hundred. But, he says, "The
pork industry is going to have to iron
itself out, and it's going to have to do it
quick. We can't keep going this way,
with the uncertainty in the market. If the
price has to fall, maybe it'll fall, and let
the industry iron itself out."
Canadian packers get a premium
dollar on their U.S. exports, Bergsma
says, and they're still going to ship to the
U.S. if there's a premium involved.
Canada Packers has said that it is going
to cut back on its exports to the U.S., he
adds, but whether packers will in fact
give up on the U.S. market remains to be
seen. "Until I see that in black and
white, I don't believe it," he says.
"If the product belonged to us, I
could see it (financing the countervail),"
he adds. "But the product doesn't be-
long to us. Once it's sold, it belongs to
the packers."
The OPPMB's decision has become
part of a national program under the
Canadian Pork Council (CPC), and 9 of
10 provinces in Canada have agreed to
participate.
Bergsma, however, says that On-
tario producers should consider that
Ontario exports only 18 or 19 per cent of
its pork to the U.S., while Quebec ex-
ports 44 per cent, and from Manitoba
and west 40 per cent is exported. New
Brunswick, which hasn't joined the
plan, exports only .6 per cent.
"Why should we subsidize Quebec
and the Western provinces that are get-
ting subsidized by their governments
already?" Bergsma asks.
The support for the Huron board's
decision is out there in the county,
Bergsma says, but it's difficult for pro-
ducers to get out to meetings at this busy
time of year. Other counties, he adds,
have indicated that they might follow
Huron's lead. "Huron County is the first
one to take this position. There is an-
other county that is working on some-
thing similar. And the smaller counties
are waiting for the bigger ones to take a
stand."
"We're asking for their support."0