Martin Rice says hog industry support programs aren’t subsidies
Grumbling by the United States and New Zealand about subsidies for Canadian hog farmers doesn’t match the reality of a declining Canadian swine herd.
Recent media reports quoted American and Kiwi farm or political spokesmen suggesting the upcoming Trans-Pacific Pact trade talks would be a good opportunity to force Canada to get rid of so-called subsidies to pork producers, claiming those subsidies give Canadian farmers an unfair advantage.
The programs in question were set up in the late 2000s to reduce production in face of low world prices by culling herds and to assist with the losses caused by a serious swine flu outbreak. They were transition programs that allowed farmers to downsize their operations on a controlled basis.
“We take issue with suggestions that Canada is providing countervailable subsidies to Canadian pig farmers,” said Canadian Pork Council executive director Martin Rice.
“In the 2004-05 countervailing (and anti-dumping) duty investigation, the U.S. Department of Commerce concluded that countervailable subsidies are not being provided to producers or exporters of live swine from Canada.”
As well, the U.S. International Trade Commission ruled in 2005 that the U.S. industry was neither being injured nor being threatened with injury from imports of live swine from Canada, he said. “Since those decisions in 2005, the Canadian swine herd has actually declined by 20 per cent,” Rice said. “Further, Canada’s production has declined significantly relative to U.S. pork production.”
While the size of the Canadian herd has dropped sharply and will likely be squeezed further by rising feed costs from this summer’s drought, U.S. pig numbers are barely below what they were in January 2006. “The facts show that Canadian programs are not distorting world pork trade,” Rice said.
The main support for livestock producers comes from AgriStability, which works like an income insurance program to prop up producers through low prices. Farmers and governments contribute and the money is available in lean years. It is generally considered as far less generous than what American producers get via the Farm Bill.