The American hog industry should look in its own back yard to understand why Canadian hogs are shipped into the United States, says a spokesperson for Maple Leaf Foods, Canada’s largest pork processor.
Gary Stott said heavily subsidized corn and soybeans give producers in the U.S. an edge when it comes to finishing hogs, which is one reason there was an increase last year in the number of feeder hogs shipped there.
Western Canada used to be viewed as one of the most affordable places in the world to finish hogs, but that distinction has shifted southward.
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“Canadian hog producers are victims of U.S. subsidies, not recipients of Canadian ones.”
Stott, who described the latest trade action against Canada as unfair and outrageous, said his company has filed an objection against the claims made by the U.S. hog industry.
“We’ll commit all types of resources and money,” he said. “We want to beat this thing. It’s not right.”
The U.S. National Pork Producers Council wants duties imposed on live hog imports from Canada, claiming Canadian hog producers receive unfair subsidies. If its complaint is successful, duties ranging from five to 20 percent could be imposed on live hogs from Canada.
The addition of a levy, even a temporary one, could be staggering for Canadian producers at a time when they are just edging back into profitability, said Neil Ketilson, general manager of Sask Pork. At current prices, even a 10 percent levy would work out to $14 per finished hog.
Ketilson said it looks like any kind of program designed to assist hog producers is under attack, including ones that don’t involve payments, such as a Farm Credit Canada program that gives producers more flexibility when repaying FCC loans.
Like Stott, Ketilson insists that unfair advantages are more likely to be found south of the border.
“One only has to look across the border at the farm bill and farm programs down there to wonder how they could even suggest we’re the problem and that we’re not trading fairly.”
The Canadian hog industry, with the support of provincial hog councils, will hire a lawyer in Washington to help defend its position, Ketilson said.
He suggested American hog producers may have been motivated to seek the duties after seeing how prices rose for American cattle last year after a case of BSE in an Alberta cow prompted the border closure to Canadian live cattle.
However, he noted that U.S. producers need to remember that large volumes of American pork also flow into Canada each year.
“The flow goes both ways, right across the country,” he said. “We are as important to them as they are to us.”
Numbers from Statistics Canada show that Canada imported 15,284 tonnes of pork from the U.S. during the first two months of this year, an increase of 46 percent over the same period the previous year.
Jim Hargreaves, whose family has a stake in a variety of hog ventures in southwestern Manitoba, said if the U.S. slaps a duty on hog imports, it would be the last straw for many Canadian producers.
He said the Canadian hog industry may have to look more closely at ways to finish and slaughter more hogs at home. He would like to see less reliance on the U.S. market.
Edouard Asnong, president of the Canadian Pork Council, said it is still working on an official response to the U.S. complaint.
“We have done everything we could possibly do to be trade friendly,” Asnong said. “We have done that and we are going to explain and prove that we did.”
