March 8, 2004

US Pork Group Files Antidumping Hog Case Vs Canada

The National Pork Producers Council on Friday announced the filing of antidumping and countervailing duty cases against Canadian live hog imports, which the group deemed "injurious to U.S. pork producers."
 
NPPC president Jon Caspers told pork producers gathered for the industry's annual business meeting in Atlanta that the move was not an attempt to close the U.S. border to Canadian hogs but to offset trade practices in Canada that were responsible for hog overproduction and a surge of imports into the U.S.
 
So far this year, as of week-ended Feb. 21, the total number of Canadian hog imports is 1.42 million with a weekly average of 177,690 head, according to the U.S. Department of Agriculture's weekly livestock import reports. The 2004 total is up 51.2% from a year ago, which had a slow start. But, this year's weekly average, if sustained throughout the year, would put the 2004 figure at over 9.2 million head, up 25% from 2003.
 
The petition filed on Friday with the U.S. Department of Commerce and International Trade Commission formally requests the U.S. government investigate whether Canadian live swine producers are receiving illegal subsidies and selling hogs in the U.S. at prices that are lower than hogs sold in Canada.
 
Selling in the export market at a discounted value to the domestic market, known as "dumping," is a violation of U.S. unfair trade laws and international trade rules established by the World Trade Organization.
 
The petition also claims that Canadian producers benefit from billions of dollars in numerous government subsidy programs.
 
Caspers cited data that indicated that during the hog price collapse in both countries in the fall of 1998, the average Canadian pork producer had an income of $44,000, $43,000 of which was in some form of government payments.
 
And, while U.S. producers "reacted rationally" to poor market conditions during that period by stabilizing or reducing herd size, their Canadian counterparts did not respond in the same manner, said Caspers.
 
Also, Caspers alluded to U.S. industry hog-production statistics from 1998 to 2003 that showed a 4.5 million-head reduction during that period, compared with Canadian production that increased by 8.6 million head.
 
As a remedy to what NPPC sees as unfair subsidies by Canada and to facilitate the elimination of unfair pricing practices, it is requesting that antidumping and countervailing duties ranging from 5% to 20% be assessed on imports of live swine from Canada, including feeder pigs, but not pork.
 
According to the pork council, the Department of Commerce should initiate the cases on March 25, 2004 and ITC will make its preliminary determination on injury by April 19, 2004.
 
If the Commerce Department and ITC rule in the National Pork Producers Council's favor, preliminary duties would be expected to become effective on June 1, 2004 for the countervailing duty case and Aug. 12, 2004 for the antidumping case, although short extensions of these deadlines are not unusual, said Caspers. The cases should be completed within a year, he added.
 
Nick Giordano, NPPC's international trade counsel said, "the International Trade Commission and International Trade Administration has 20 days to decide whether or not to initiate. We're very confident they will."