Voluntary Report - public distribution

**Date:** 3/10/2004

**GAIN Report Number:** CA4018

CA4018

**Canada**

**Agricultural Situation**

**This Week in Canadian Agriculture, Issue 10**

**2004**

**Approved by:**

![](media/image1.wmf)Gary C. Groves

U.S. Embassy

**Prepared by:**

George Myles

**Report Highlights:**

\* Increased Access for U.S. Feeder Cattle \* Canada\'s Hog Industry to
Defend Itself Against U.S. Countervail and Anti-Dumping Charges \* High
Pathogenic Avian Influenza Found on B.C. Farm \* Dumping Decision
Extended on U.S. Frozen Pizza \* New Canada Food Guide Could Be Good
News for U.S. Fruit and Vegetable Exports \* Trade Minister Defends
Supply Management \* Higher Dry Pea Production Forecast

Includes PSD Changes: No

Includes Trade Matrix: No

Unscheduled Report

Ottawa \[CA1\]

\[CA\]

This Week in Canadian Agriculture is a weekly review of Canadian
agricultural industry developments of interest to the U.S. agricultural
community. The issues summarized in this report cover a wide range of
subject matter obtained from Canadian press reports, government press
releases, and host country agricultural officials and representatives.

*Disclaimer*: Any press report summaries in this report are included to
bring U.S. readership closer to the pulse of Canadian developments in
agriculture. In no way do the views and opinions of these sources
reflect USDA's, the U.S. Embassy's, or any other U.S. Government
agency's point of view or official policy.

INCREASED ACCESS FOR U.S. FEEDER CATTLE: Canada has announced its
intention to increase access for U.S. feeder cattle from 39 states.
Canada's Agriculture Minister, Bob Speller announced that Canada will
remove anaplasmosis and bluetongue testing and treatment requirements
from feeder cattle imported from the United States enabling year-round
access to Canadian feedlots. *Comment: Before the increased access could
be realized, Canada will have to revise the current list of exemptions
under its BSE import restrictions. Currently, only U.S. bovines for
immediate slaughter are permitted entry into Canada under BSE control
measures. Prior to the rule change, Canadian feedlots could only import
U.S. feeder cattle from 8 designated states during the winter period
October through March when the opportunity for vectors to spread disease
is considered negligible. During the 2000-2001 winter period, the U.S.
exported more than 210,000 feeder cattle to Canada valued at an
estimated \$100 million. In the 2001-2002 six-month import season,
exports slipped to about 120,000 head but were valued at more than \$60
million. The effects of drought, tight feed grain supplies, and the
disruption of BSE lessened Canadian imports of U.S. feeders in
subsequent years, but the new import protocol offers the potential for
significant increases in future years once North American live bovine
trade returns to normalcy.*

CANADA'S HOG INDUSTRY WILL DEFEND ITSELF AGAINST U.S. COUNTERVAIL AND
ANTI-DUMPING CHARGES: Canadian Pork Council President Edouard Asnong
says that the Canadian Pork Council (CPC), the national organization
representing Canadian hog producers, is preparing to defend Canada\'s
hog industry against the U.S. trade actions to impose countervailing
(CVD) and anti-dumping (AD) duties on Canadian live hog imports. On
March 5, 2004, the U.S. International Trade Commission, in response to a
petition filed by the National Pork Producers Association, state pork
organizations, and individual U.S. producers, instituted the CVD and AD
actions. Asnong claimed that Canada trade hogs fairly and vowed that the
CPC would present a strong case in representing the interests of
Canadian hog producers.

HIGH PATHOGENIC AVIAN INFLUENZA FOUND ON B.C. FARM; EC JOINS BAN: The
Canadian Food Inspection Agency (CFIA) announced that the high
pathogenic form of the H7N3 virus were present on the same B.C. poultry
farm that tested positive for low pathogenic avian influenza in late
February, 2004. In addition, another B.C. poultry farm is under
quarantine and surveillance by CFIA. The European Commission has joined
a number of countries that already have import restrictions on Canadian
poultry (China, Japan, South Korea, Hong Kong, Singapore and the
Philippines) and the Canadian poultry industry is concerned that
additional countries will also impose bans. Of total Canadian poultry
and poultry meat exports during 2003 of \$100 million, the Asia Pacific
region accounted for about \$13 million. The major share of Canadian
live poultry and poultry meat exports in 2003 was to the United States
(\$70 million). Canada placed temporary import restrictions on live
poultry and poultry products from Texas on February 23, 2004 following
the confirmation of highly pathogenic avian influenza in the state (see
CA4016).

DUMPING DECISION ON FROZEN PIZZA EXTENDED TO MAY 17: The Canada Border
Services Agency (CBSA) announced an extension of an investigation into
the alleged injurious dumping of frozen self-rising pizza from the
United States. A preliminary decision pertaining to all or part of the
investigation will be made by May 17, 2004 (originally slated for April
1). The CBSA extended the 90-day period for making a preliminary
decision due to the complexity of the transactions involved in the case.
The agency said it required additional time to analyze completely the
domestic and export sales of the goods. The anti-dumping investigation
was launched in January 2004 when the CBSA initiated an investigation
into the alleged dumping of frozen self-rising pizza from the United
States. The CBSA started the investigation after receiving a complaint
filed by McCain Foods Limited of Florenceville, New Brunswick. The
Canadian company alleged that the dumping of the goods in question is
harming Canadian production by causing price erosion, price suppression
and lost sales. See CA4015 and CA4001 for background information.

PLAN TO REVISE CANADA'S FOOD GUIDE COULD BE GOOD NEWS FOR U.S. FRUIT AND
VEGETABLE EXPORTS: Health Canada announced this week that the Canada
Food Guide, entitled, *Canada's Food Guide to Healthy Eating*, will
undergo an update to incorporate new science about the relationship
between diet and health that has evolved since the guide was last
revised in the 1990s. The new food guide is scheduled for March 2006 and
is expected to split the current fruit and vegetable category into two,
in order to encourage more fruit and vegetable consumption. Canada
relies heavily on imports of U.S. fresh fruits and vegetables. U.S.
fresh fruit and vegetable exports to Canada in 2003 reached \$1.8
billion, accounting for half of total U.S. fresh fruits and vegetable
exports to the world. For more information go to the following Health
Canada webpage:

http://www.hc-sc.gc.ca/hpfb-dgpsa/onpp-bppn/review_interpret_findings_e.html

TRADE MINISTER DEFENDS SUPPLY MANAGEMENT: In response to the
International Monetary Fund's (IMF) annual review on the Canadian
economy (IMF Country Report 04/60), Canada's Trade Minister Jim Peterson
reportedly told the press that Canada will not open up its highly
protected domestic dairy and poultry sectors. In its report the IMF said
that despite the significant integration between the two countries under
NAFTA, that additional significant benefits could be reaped from further
reducing other barriers to trade. Peterson reportedly told Reuters,
\"Our agriculture programs are minimal in comparison to the massive
subsidies we see in the European Union and U.S.,\" \"They are so minimal
in terms of the overall scope of discussions that they are not on the
table.\"

HIGHER DRY PEA PRODUCTION FORECAST: Agriculture and Agri-Food Canada
crop analysts expect Canadian dry pea production to advance by about 11%
to 2.36 million metric tons with higher yields offsetting an anticipated
5% decline in area. Canada is the largest producer of dry peas in the
world, accounting, on average, for about 20% of world production. In
2002, Canada accounted for 28% of world exports, second to France with
30%. AAFC forecasts Canadian exports to increase in 2003-2004. In
addition to the export market, dry pea production in western Canada has
provided producers with an alternative cash crop to use in their
rotations and livestock feeders with a new feed ingredient. AAFC
analysts believe U.S. Farm Bill provisions provide a major challenge for
the dry pea industry in Canada. They are closely watching whether dry
pea eligibility for the loan program will lead to sharp increase in U.S.
dry pea production.

**Find FAS on the World Wide Web:** Visit our headquarters' home page at
[http://www.fas.usda.gov](http://www.fas.usda.gov/) for a complete
listing of FAS' worldwide agricultural reporting.

Recent Reports from FAS/Ottawa:

+----------------+---------------------------------------+------------+
| Report Number  | Title of Report                       | Date       |
+----------------+---------------------------------------+------------+
| ## CA4017      | Increased Access for U.S. Feeder      | 3/11/2004  |
|                | Cattle                                |            |
+----------------+---------------------------------------+------------+
| ## CA4016      | This Week in Canadian Agriculture,    | 3/5/2004   |
|                | Issue 9                               |            |
+----------------+---------------------------------------+------------+
| ## CA4015      | Affirmative Injury Ruling on U.S.     | 3/3/2004   |
|                | Pizza                                 |            |
+----------------+---------------------------------------+------------+
| ## CA4014      | This Week in Canadian Agriculture,    | 2/26/2004  |
|                | Issue 8                               |            |
+----------------+---------------------------------------+------------+
| ## CA4013      | Grain and Feed Annual Report          | 2/24/2004  |
+----------------+---------------------------------------+------------+

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