June 20, 2012

Canada urged to cease hog subsidy before TPP talks

The US-based National Pork Producers Council (NPPC) has requested the Canadian government to cease its hog subsidy, prior to entering the Trans-Pacific Partnership (TPP) trade talks.

The NPPC asked Canadian federal and provincial government officials to stop their subsidy on the grounds that something similar in the US would see pork production there more than double in 10 years, which would adversely affect the Canadian hog market.

By looking at only the Quebec subsidy programme, Iowa State University economist, Dermot Hayes, estimated a similar US-based programme would create an 8.4% annual increase in pork production, which would add 140 million hogs to the market in just 10 years.

Doug Wolf, NPPC's immediate past president and chairman of its trade committee, said, "The Canadian subsidy programmes distort the North American hog and pork market, limiting the growth of US production, employment and profitability."

"Canada's entry into the TPP negotiations should be contingent on renunciation of its trade-distorting subsidies."

In response to criticism of its subsidy programmes, Canada has pointed to the US Mandatory Country-of-Origin Labelling (MCOOL) law, which the World Trade Organisation (WTO) last November said violates US trade obligations.

The US pork industry, however, did not support MCOOL and NPPC is urging the US to comply with the upcoming WTO appellate ruling on the US' appeal of the earlier decision.