February 25, 2008


Canadian hog producers fear effects of new US labelling rules


Canadian hog producers, who are already suffering losses from a strong currency and high feed costs, now fear for their US markets as proposed US food-labelling laws could hurt the hog industry even further.


Hog producers in Manitoba, who ship two-thirds of all Canadian pigs, are the most vulnerable to the new COOL rules. They fear they could either be forced out of the US markets or made to offer large discounts to attract US packers, which would ultimately lead to liquidation of breeding herds.


US' country-of-origin labelling (COOL) rules could be included in this year's farm bill, which is expected to pass next month, with regulations taking effect on September 30, 2008. The law would require retailers to label the country of origin for some foods, including fresh pork.


Andrew Dickson, general manager of the Manitoba Pork Council, said some US hog feeders have stopped renewing their contracts to buy weanling pigs and he feared the adverse effect COOL could have on the weanling industry.


US hog processor John Morrell Co., have also informed Manitoba producers in December that it would not be buying any Canadian animals as of September.


Fearing for Manitoba's US$1 billion hog industry, Manitoba's premier Gary Doer visited Washington to ask US legislators to consider Canadian pigs fed to market weight in the US to be labelled as an US product, although several US observers did not think compromises are possible.


David Preisler, executive director of the Minnesota Pork Producers Association, said attitudes on labelling have hardened due to contaminated pet-food scares and other consumer issues, even though that has nothing to do with the pork industry.


US producers are uncertain if there would be any backlash if they buy Canadian hogs but several groups have asked for the delay of COOL's implementation to allow more adjusting time for the industry.


However, Bill Greer, a spokesman for the Food Marketing Institute, said surveys have not been done to determine consumers' reaction, and he noted that buying patterns did not change when COOL was implemented for seafood some time ago.


Martin Rice, executive director of the Canadian Pork Council, also said a maximum of 20 percent of pork from Canadian hogs would be subject to COOL. Processed pork, and food sold to institutions such as hospitals will be exempted.


Last year, Manitoba producers sold US$346 million worth of weanling and market-weight hogs to the US. Canadian pigs also make up for 7-10 percent of total US hog slaughter.