NEWS RELEASES

April 8, 2004                         (6:15 p.m. EDT)                                    No. 54

CANADA READY TO DEFEND ITS LIVE SWINE INDUSTRY

AGAINST U.S. CHALLENGE

The Government of Canada today expressed its disappointment about the decision of the U.S. Department of Commerce (DOC) to pursue investigations on imports of live swine from Canada.

“We believe that any investigation into allegations made by the U.S. industry will show that our hog exports are not subsidized,” said International Trade Minister Jim Peterson. “The United States decided in 1999 that our exports were fairly traded, and this is still the case today.”

On March 5, 2004, the U.S. National Pork Producers Council filed a petition with the U.S. DOC requesting countervailing and anti-dumping duty investigations on imports of live hogs from Canada.

“We will work closely with the industry and the provinces to defend our live swine export industry,” said Agriculture and Agri-Food Minister Bob Speller. “The Agriculture and Agri-Food Canada programs referred in these allegations are whole-farm programs available to all producers.”

The U.S. investigations are governed by U.S. trade remedy law and the WTO agreements dealing with countervailing and anti-dumping measures.

Duties cannot be imposed until a series of determinations are made by U.S. authorities, including findings on subsidization, dumping and injury to the U.S. domestic industry as a result of the imports.

In 2003, Canada exported approximately 7.4 million hogs, valued at $554 million, primarily from Ontario, Manitoba, Saskatchewan and Alberta. The U.S. is the principal market for Canadian live swine exports.

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A backgrounder is attached.

For further information, media representatives may contact:

Jacqueline LaRocque
Director of Communications
Office of the Minister of International Trade
(613) 992-7332

Media Relations Office
Foreign Affairs Canada and International Trade Canada
(613) 995-1874

Carla Ventin
Press Secretary
Office of the Minister of Agriculture and Agri-Food
(613) 759-1346

Media Relations
Agriculture and Agri-Food Canada
(613) 759-7972

This document is also available on the Internet site of Foreign Affairs Canada and International Trade Canada: http://www.dfait-maeci.gc.ca.

Backgrounder

The National Pork Producers Council, representing U.S. swine producers, filed a petition on March 5, 2004, with the U.S. Department of Commerce (DOC) requesting countervailing and anti-dumping duty investigations on imports of live swine from Canada. The allegations are that live swine from Canada are being sold at less than fair value and that Canada is unfairly subsidizing imports of live swine.

Federal officials held consultations in Washington, D.C., on March 19 with U.S. officials to highlight serious deficiencies in the allegations raised by the U.S. industry in its petition.

On April 8, 2004, the Government of Canada was notified by the U.S. DOC that it had initiated investigations as sought by the National Pork Producers Council.

Anti-dumping and countervailing duties cannot be imposed until a series of determinations are made by the U.S. DOC, including findings on subsidization and dumping. The U.S. International Trade Commission must also determine whether injury to the U.S. domestic industry is linked to the imports.

An anti-dumping duty is a special duty imposed to protect a domestic industry from goods sold in that market at prices below those charged for comparable sales in the producer’s home market, or sold at below the cost of producing the goods.

A countervailing duty is a special duty imposed to protect a domestic industry from injury caused by imports that have benefited from subsidies provided by a foreign government. Subsidies that are generally available, i.e., that are not directed specifically at an enterprise, industry or group of enterprises or industries, are not countervailable.

On the subsidy side, now that the U.S. DOC has initiated an investigation, the earliest date when preliminary countervailing duties could be collected is June 11, 2004.

The earliest date when preliminary anti-dumping duties could be collected is

August 25, 2004.

Countervailing duties were in place from 1985 until the end of 1999. The U.S. concluded in 1999 that our exports were fairly traded. The federal and provincial governments worked closely with the Canadian industry in defending the interests of Canadian exporters during that period, and will do so again.