December 28, 2007

Australian pork producers wary on surge of imports, up 40 percent

Australian imports of processed pork rose sharply by 40 percent in the last twelve months, supplied mainly by Denmark, Canada and the US.

A report by ITS Global stated that imports now account for 64 percent of the local processed pork market, threatening the Australian pork producers.

The industry body, Australian Pork, called on the new Federal Labour Government to introduce safeguard provisions to restrict trade for 12 months while the Australian pig industry undergoes structural adjustment.

Khalil Hegerty of ITS Global said that the requested safeguard provisions are legal under World Trade Organization (WTO). The Productivity Commission constituted by the outgoing coalition government had the power to recommend the implementation of safeguards, because WTO rules require that import safeguards have to be part of a public review.

Influx of imports had reduced prices in the Australian pork market to such an extent that local producers who are also facing record high feed grain prices, are now losing US$0.48/kilogramme, or about US$35/pig. It is further estimated that the industry is losing about US$182 million a year.