TPP vital to Canada's pork industry says pork council chair
Monday, May 25, 2015
by JIM ALGIE
Canadian participation in Trans-Pacific Partnership (TPP) trade talks remains critical to hog farmers and pork processors in this country, Canadian Pork Council chair Rick Bergmann said Monday.
A federation of nine provincial pork producers’ associations, the Ottawa-based council released a 13-page report by Kevin Grier, consulting livestock analyst, about the potential impact of TPP.
“In the event Canada is not part of the TPP agreement, pork producers would see a significant decline in the value of their pigs,” Bergmann said in a statement that emphasized the importance of potential new sales to the high value Japanese market.
“The Canadian pork sector could see, in short order, a decline of almost four per cent in the volume of pork exports to Japan,” he said.
Release of Grier’s report follows cancellation last week of a scheduled meeting in Guam of trade ministers of 12 nations involved including Canada, the United States and Japan. The report is part of a broader public effort by Canadian agricultural export groups to show support for continuing government work on TPP, Pork Council public relations manager Gary Stordy said in an interview, today.
The release and Bergmann’s comments coincide also with current controversy in U.S. Congress about fast-track approval for the agreement which has not been released publicly. Some observers say more than five years of talks about the deal are close to completion, possibly as soon as late June, depending on Congressional fast-track approval.
Grier’s report analyses pork export data to conclude Canadian participation in any future multi-nation trade agreement involving Japan and the United States is essential. Worth $3.4 billion in 2014, a record in tonnage, exports already account for about 60 per cent of Canadian pork production, the report says. Of that, 80 per cent involves TPP participants, half of it with U.S. buyers.
“The key message is that with regard to value, the TPP member countries represent a very important component of Canada’s pork exports and thus are crucial to the Canadian industry,” Grier’s report says. He underlines the need for continued access to relatively high-priced, Japanese markets that might be denied Canada outside of TPP.
Grier examines potential Japanese market scenarios with and without TPP involvement by Canada. Lost access to Japan proves crucial, he said.
“This impact cannot be understated: No other overseas market success can compensate for a failure in Japan,” Grier maintains. Canadian participation in TPP and a potential 10 per cent increase in Canadian sales to Japan provides significant benefits to Canada.
“A 10 per cent increase in tonnage would mean an additional $87 million per year in exports to Japan. An added $87 million in sales translates to over a quarter billion dollars in added economic activity for Canada and well over 1,100 new jobs,” Grier says. Such estimates are speculative and depend on final details of any trade agreement and their impact on domestic hog production in Japan, the report says.
However, Grier and the Pork Council’s Stordy expect Japan would remain a relatively high value market for pork even following any TPP agreement even if it lowers its existing, relatively high “gate price” for imports.
“Japan is a high value market,” Stordy said in an interview, Tuesday. “They have strict expectations on meat that they import both in quality and safety . . . and they do have a high price point for the pork that they buy,” he said.
“We do expect that to continue,” Stordy said. “If Canada is not in TPP and TPP moves forward with Japan, our industry is in trouble,” he added.
TPP talks seem near completion although some reports suggest Canada has been dragging its feet on access for dairy and poultry products controlled by Canada’s domestic supply-management system. An April report by John Ivison of the National Post quotes U.S. chief agricultural negotiator Darci Vetter to say Canada has “declined to seriously engage” in talks about opening domestic dairy and poultry markets.
Even so, a Wall Street Journal report this week quotes U.S. Trade Representative Michael Froman to say Senate passage of fast-track legislation has added new momentum to TPP. The Senate law is expected to be introduced in the House of Representatives in June where it may face opposition. Major labour groups have mounted strong objections to the trade agreement over potential job loss issues.
Any failure of fast-track approval for U.S. negotiators will delay the final agreement, Stordy predicted, Tuesday.
“Everybody involved with TPP negotiations is watching and following what’s going on,” he said. “That fast-track agreement needs to happen and it should happen to help move TPP along,” Stordy said. BF
UPDATE: Friday May 29 2015
by SUSAN MANN
Isabelle Bouchard, Dairy Farmers of Canada communications and government relations director, says farmers in Canada’s supply managed commodities are getting anxious “because of the uncertainty” and increasing pressure to ditch the system that uses tariffs and domestic supply controls to maintain predictable prices for farmers. “We’re seeing in the media that New Zealand, the United States and Australia are talking about wanting more access to Canada’s supply managed sectors. That’s why we are worried. We don’t know what’s going to happen.”
So far, the federal government has publicly committed to maintaining the system but Canada is facing a lot of pressure from other countries. “We’re very happy the Canadian government is holding its ground right now,” she notes.
Dairy Farmers of Canada has launched a public relations campaign “to tell the story of how dairy farms contribute to building vibrant communities across the country,” a May 28 Dairy Farmers news release says.
Bouchard says the campaign is geared towards Canadians “so they can understand how important it is to support the dairy farmers and to support supply management because this system benefits every part of the country.” BF