Claims by a major U.S. hog farmers’ group that the Canadian Pork Council’s proposal for industry transition funds would have a “lethal impact” on U.S. producers is particularly galling for the CPC’s chair.
Jurgen Preugschas, who raises breeding stock and finishes hogs at Mayerthorpe, Alta., retorted in a release last week to the National Pork Producers Council (NPPC) claim of a negative impact on U.S. hog prices from a Canadian program.
“On the contrary, Canadian pig prices have been in large part artificially depressed by such things as U.S. country-of-origin labelling (COOL) rules,” he said.
“Many former U.S. customers for Canadian pigs and pork have ceased purchasing our products due to the burden COOL has created for food handlers in the U.S.,” he said Thursday.
“Live hog exports from Canada to the U.S., since COOL became mandatory, have declined sharply. Fully 36 per cent fewer hogs have been exported to the U.S. this year compared to last.”
Canada and the U.S. have both benefited from free trade in hogs and pork products, the council said, and an open border has “supported greater efficiency and provided jobs all along the supply chain in our two countries.”
In the past three years, however, “dramatic adjustments to Canada’s productive capacity have already taken place and the NPPC knows this,” Preugschas said.
The NPPC, in a release Monday, characterized the CPC’s proposal to Ottawa for a federally-funded “Strategic Transition Plan” as a “cash bailout” that would “artificially prop up Canadian pork production.”
The U.S. council also quoted Iowa State University economist Dermot Hayes as saying U.S. live hog prices, given such a program in place in Canada, would end up about seven per cent lower than otherwise would have been the case.
The NPPC said it would keep “all options open” in the event that Canada proceeds with such a program.
The CPC, in its response Thursday, said the Canadian breeding sow herd has declined six per cent this year compared to last, and nearly 12 per cent since 2007.
By comparison, the CPC said, the U.S. breeding herd has decreased by less than four per cent over these past two years, or only a third of the cut experienced in Canada.
“The fact that U.S. production is not declining faster, despite suffering losses averaging $21 per pig since October 2007 according to the NPPC statement, is, frankly, quite surprising and disappointing,” Preugschas said.
Canada’s federal government hasn’t yet offered an official response to the CPC’s proposal for a transition plan, which would include transition payments, adjusted advance payments and new loans to recover from international bad press due to the so-called “swine flu,” as the pandemic H1N1 influenza virus has been dubbed in major media.
Agriculture Minister Gerry Ritz was quoted about two weeks ago as saying officials from the federal ag ministry and the CPC have been working to see how the council’s proposal can be prompted forward and what it could cost governments to implement.