Ontario hog farmers squirming over US import curbs on Canadian porkers
Hillsburgh, Ontario — ``Put pork on your fork.'' That's the advertising slogan of the Ontario Pork Producers Marketing Board. It is going to have to do a lot more advertising to sell the product at home, because the biggest export market just slammed the door on Canadian hogs.
The United States has increased the tariff on imports of Canadian hogs. Canada sold C$404 million (Canadian) worth of hogs to the US last year. That is 25 percent of Canada's annual hog production, but only 4 percent of the US market.
The export ban is good news for Canadians entering the summer barbecue season: Lower pork prices at supermarkets are dragging down beef prices as well. But it is bad news for Canadian pig farmers, who are watching prices for their animals drop.
``We were already hurting a great deal, but this ruling really knocks the stuffing out of us,'' says Tom Smith, chairman of the Ontario Pork Producers Marketing Board.
Canadian farmers are coming face to face with the consequences of their government's ``farm stabilization programs.'' The programs do bolster farmers' income, but critics say the plans help keep inefficient producers in business and mean higher prices for consumers, who have to finance the farmers' freedom from anxiety.
There are milk, egg, broiler turkey, and dozens of other federal and provincial marketing boards in Canada. Some set prices, others don't. Some even sell the right to get into business. Only a millionaire can be a chicken farmer in Canada. Pig farming is not so organized, but hog farmers do receive subsidies, which make it difficult for a farmer to go broke.
``The intent of the programs is to provide a degree of income security for our farmers without distorting the marketplace,'' says the federal minister of international trade, James Kelleher.
But the US Department of Commerce recently decided a duty on Canadian pork is justified because of the subsidies. The decision means an increase in the countervailing duty on live hogs from 3.8 cents a pound to 4.39 cents a pound and on frozen pork from 5.3 cents to 5.5 cents. The duty on pork imported into the US will jump by C$2 to C$11 for the average animal.
Many Canadian pig farmers contend that the farm programs have nothing to do with the American tariff increase. The Canadian dollar, which is worth only 73 US cents, has made Canadian pigs cheap. The farmers say the tariff increase is to keep out cheap Canadian hogs.
Farming is mixed in rolling country around Hillsburgh, Ontario, about 60 miles northwest of Toronto. There are potato farms, dairy farms, ``U-Pik'' strawberry operations, even a few hog farms. But there are going to be fewer now.
``I know of half a dozen hog farmers within a five-mile radius of here who have gone into other areas of farming or who lost their farms,'' says Ken Jessop, who raises 400 pigs. ``And this ruling means more will be going out of hogs.'' He says the new duty will hurt farmers. ``The increase is about $10 per hundred, and that's the difference between profit and loss.''
Mr. Jessop agrees that Washington does have an argument about government subsidy programs, ``but a blanket statement about stabilization is just not fair. It hurts the Ontario farmer, because we're one of the two producing provinces without subsidies.''
There is one slight subsidy in Ontario, but it has been ineffective. There are no subsidies in Alberta. But the provinces of Quebec, Manitoba, Saskatchewan, and British Columbia heavily subsidize pork producers.
The federal government is trying to change that. Agriculture Minister John Wise has called for a review of all marketing boards and other farm stabilization programs in Canada. Washington has indicated it will review its tariffs if Canada alters the subsidy programs.