Pork Producers Disappointed that Duty Lifted on Canada

November 5, 1999

The National Pork Producers Council is disappointed "and surprised" that the Commerce Department will end the countervailing duty on live hog imports from Canada on Jan. 1. With hog prices still at historically low levels, revoking the order now "could not come at a worse time," one ag economist had told the International Trade Commission (ITC).

NPPC noted that in a preliminary ruling earlier this year, Commerce had concluded that Canadian subsidies equaling $3.04 per hog would resurface if the order was revoked. "The final ruling reversed the earlier Commerce determination and apparently involved a new method for calculating the likelihood of subsidies returning," said NPPC President John McNutt. "We are studying this new methodology and our opportunities for reversal of this decision."

McNutt said NPPC devoted "a great deal of time and non-checkoff resources to preserve the countervailing duty order. Agriculture economist Glenn Grimes had told the ITC Sept. 16 that revocation of the current order could not come "at a worse time for the domestic (hog) industry."

The countervailing duty order was imposed first in 1985. For the past several years, Commerce has set the duty at zero. U.S. imports of barrows and gilts, the Canadian hogs subject to the duties, have increased more than 400% sicne 1994 to 2.5 million head, according to economist Michael Kerwin, says NPPC.

Since the duty was set at zero, it "is a testament to the order's success. Canada was forced to fundamentally change its policy which were harming American producers."