U.S ANTIDUMPING DUTY DECREASED BUT NOT ELIMINATED

The United States Department of Commerce (DOC) has set the final countervail and antidumping duties for live swine imports from Canada.

As expected, the DOC has ruled that Canada does not provide countervailable subsidies to its swine producers and therefore the countervail rate remains at zero. The antidumping rate was decreased from the preliminary rate of 14.06 per cent, to 10.63 per cent.

"I am pleased that the DOC has recognized that Canada does not provide countervailable subsidies, but disappointed that they have maintained the antidumping duty," Agriculture and Food Minister Mark Wartman said. "Canadian hogs are traded fairly. It is clear that protectionist interests in the U.S have driven this investigation. Ironically, the duties have also hurt U.S. interests, since the recent increases in live hog exports to the U.S. have been mostly weanlings that are fed in U.S. barns."

The countervail and antidumping investigations were launched on March 5th, 2004, by the U.S. National Pork Producers Council. Under an antidumping investigation, the United States Department of Commerce can apply duties if its investigation finds that the exports in question are sold in the U.S. market below the price sold in the exporter's domestic market or below the exporter's cost of production. A countervail investigation looks at whether subsidies are being provided to the exported product in question.

"Countervail and antidumping investigations are not appropriate mechanisms for judging whether or not agricultural goods are traded fairly," Government Relations Minister Len Taylor said. "Antidumping investigations fail to take into account the cyclical nature of agriculture goods and are based on artificial cost estimates. Countervail investigations fail to account for the subsidies received by the complaining parties. Again, these problems show that we need a new trade remedy system in NAFTA, one that recognizes the realities of cross border trade in primary products."

The U.S. will now rule on whether Canadian live hog exports have caused injury to U.S. producers. The injury determination is expected on April 21st, 2005. If it is ruled that no injury has occurred, the duty will be removed and the deposits returned to producers. If it is determined that U.S. producers have been injured, then the duties will remain in place, but can be reviewed each year if either side requests a review.

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For More Information, Contact:

Scott Brown Agriculture, Food and Rural Revitalization Regina Phone: (306) 787-4031