The U.S. Commerce Department today released a preliminary ruling that essentially states that Canadian live hogs do not receive subsidies that would warrant the United States to impose a countervailing duty on related imports.

On March 5, 2004, the National Pork Producers Council, some state pork producer organizations and individual U.S. pork producers, filed anti-dumping and countervailing duty petitions with the U.S. government against Canadian live-hog imports. NPPC and the producer groups said the action was "an effort to redress the injury that has been caused by the recent surge in unfairly traded imports of hogs from Canada." The groups contend that the objective is to "remedy the imbalance in the marketplace that has been caused by unfair Canadian trade practices." 

On May 7, the U.S. International Trade Commission unanimously found that there is a reasonable indication of injury to U.S. pork producers from unfairly traded hog imports from Canada, notes NPPC. The Commerce Department will render its final subsidy determination sometime in early 2005, followed by the final ITC investigation.

In a separate but related case, the Commerce Department has postponed a preliminary ruling concerning whether Canadian hogs are being dumped in the U.S. market. That ruling, which could impose duties, is expected on Oct. 15.

It's possible that the Commerce Department could reach a different conclusion in its final ruling on countervailing duties.

NPPC officials expressed surprise and disappointment over the Commerce Department's finding. Jon Caspers, NPPC's immediate past president, said “We have not had a chance to review the Commerce Department’s analysis, but it is public knowledge that the Canadian producers have received large amounts of subsidies over the years. We expect that when the Department reaches its final determination, there will be an affirmative determination of countervailable subsidies.”

National Pork Producers Council