February 3, 2005

International competition to affect US pork industry in 2005

Despite profitable market trends and strong consumer demand, international competition and government regulations will prove to be defining factors in the US pork industry in 2005.

According to the chief executive officer of the National Pork Producers Council, one big problem that farmers are dealing with is unfair competition with Canadian producers. He said a large number of pigs that are coming across the border and being dumped into the US marketplace. Neil Dierks said NPPC will continue to push for government action to balance trade, and that the problem stems from direct subsidies the Canadian producers receive from their government.

"We believe in free trade. Our concern with it is we just want to make sure trade is on a level playing field," he said. "Our US producers do not receive direct subsidies."

Meanwhile, government action is also expected to be one of the challenges some producers will face this year. A series of workshops at this week's annual meeting of the Illinois Pork Producers Association highlighted permit requirements and environmental programs being required of some farmers. While not every farmer is affected by the programs, many producers are included in new government program or changes in old policy.

IPPA's Executive Director said his group has spent much time in the last year with government officials trying to show the critical importance that pork production plays in the state's overall economy.

"I just feel like our members did an incredible job of educating the General Assembly and the [Governor's] administration on what livestock brings to the table," said Jim Kaitschuck. "Clearly they heard an even stronger message: what can we do to support this industry that clearly has a strong value here in Illinois."

Kaitschuck looks to the success of Illinois' livestock groups last year in thwarting the Governor's plan to repeal Illinois' agricultural sales tax exemption.

Both men agree that farm groups will have their work cut out for them this year. Meanwhile, the two said they expect 2005 to be a strong year for pork producers.

"Fifty dollar hogs definitely have a tremendous impact," said Kaitschuck. "There's much more enthusiasm in the industry. It is not so much talking about all the challenges we have to face. There are challenges out there. But there is compensation, be it monetary or otherwise that is outweighing it all."