WORLD TRADE
ORGANIZATIONG/SG/N/8/AUS/1
18 December 1998
(98-5098)
Committee on Safeguards Original:  English
NOTIFICATION UNDER ARTICLE 12.1(B) OF THE
AGREEMENT ON SAFEGUARDS ON FINDING A SERIOUS INJURY
OR THREAT THEREOF CAUSED BY INCREASED IMPORTS
AUSTRALIA
The following communication, dated 15 December 1998, has been received from the
Permanent Mission of Australia.
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Pursuant to Article 12.1(b) of the Agreement, and in light of the formats for notifications
adopted by the Committee (G/SG/W/1, 24 February 1995), Australia provides notification of a finding
of serious injury caused by increased imports of frozen, boneless pork.
On 12 November 1998, under the reference notified in G/SG/N/6/AUS/1, the Productivity
Commission ("the Commission") reported to the Go vernment that frozen, boneless pork is being
imported into Australia in such increased quantities as to be causing serious injury to the domestic
industry concerned.  The report can also be accessed electronically at the Commission's website
(http://www.pc.gov.au).
A full analysis of the Commission's findings is contained in its Report.  Brief extracts from
that report are set out under items 1 and 2.  However, they need to be read in the context of the full
Report.
Consistent with Article 12.3 of the Safeguards Agreement, Australia is prepared to consult
with those Members having a substantial interest as exporters of the product concerned.
1. Provide evidence of serious injury or threat thereof caused by increased imports
The information regarding injury and causation is contained in the Report referred to above.
The following are extracts:
Serious injury
"The Commission is of the view that the domestic industry … has suffered and is
suffering serious injury caused by pig prices lower than average production costs for
most of 1998. This has resulted in financial losses across the entire spectrum of piggrowers.  Reduced demand for local boned legs and other cuts by smallgoods
manufacturers also appears to have affected profitability of specialist pig abattoir and
boning operations (see, for example, sub. 52).G/SG/N/8/AUS/1
Page 2
While losses or, at least, lower profitability in the early months of the year, appear to
be part of the normal pig cycle, losses in 1998 appear to be far more pronounced and
prolonged than in previous years, causing a significant overall impairment in the
position of the domestic industry.
Lower profits have been driven by lower prices.  The industry normally would expect
lower prices in the first six months of the year.  However, the recent price fall began
during the traditional high demand period for legs (in October 1997) and continued
until mid-1998.  Since July 1998, prices have risen, reaching just under 190c/ kg for
baconers in September and October.  However, this price is around 25c/kg below the
average September/October price received between 1990 and 1996, 20c/kg below the
average September/ October price received between 1990 and 1995 (thus excluding
the 1996 peak) and 30c/kg below the price received at the same time last year.  Theflatness of prices over September and October suggests that there will be no
'Christmas premium' this year.''
Causation
"The Commission considers that increased imports from Canada since mid-1996 have
caused serious injury to the industry. Moreover, the Commission considers that
increased imports were the primary cause of low pig prices and negative rates of
return (lower than could have been expected given rebuilding of domestic production
over 1997-98) in 1998 which, in turn, caused a significant overall impairment in the
position of the domestic industry.  There does not appear to be any other factorcapable of explaining the large fall in demand for local pigmeat and consequent
prolonged and pronounced fall in pigmeat prices which has occurred since
October 1997."
2. Provide information on whether there is an absolute increase in imports or an increase in
imports relative to domestic production
The information regarding increased imports is contained in the Report referred to above.
The following is an extract:"Between 1995-96 [July/June] and 1996-97 [July/June], annual imports of Canadian
pork (within tariff subheading 0203.29) increased by 173 per cent (that is, almosttripled), from 3130 tonnes in 1995-96 to 8550 tonnes in 1996-97.  In 1997-98,
7990 tonnes were imported, about 6 per cent below the level in the previous financial
year.''
3. Provide a precise description of the product involved
Meat of swine, frozen, other (i.e. excluding:  carcasses and half-carcasses;  and hams,
shoulders and cuts thereof, with bone in), provided for in subheading 0203.29.00 of the Customs
Tariff schedule of Australia.
4. Provide a precise description of the proposed measure
The Commission considered that a tariff of 10 per cent in the first year reduced to 5 per cent
in the second year and reverting to 0 per cent thereafter can be justified under the WTO safeguard
criteria.G/SG/N/8/AUS/1
Page 3
5. Provide proposed date of introduction of the measure
The Government is yet to consider its response to the Productivity Commission's report and it
is this response which will determine the Government's course of action.
6. Provide expected duration of the measure
Not applicable.  However, for details of the tariff measure presented by the Productivity
Commission as a justifiable response, see Question 4.
7. For a measure with a duration of more than three years, provide the proposed date for the
review (under Article 7.4) to be held not later th an the mid-term of the measure, if such a date
for the review has already been scheduled
Not applicable.
8. If the expected duration is over one year, provide expected timetable for progressive
liberalization of the measure
Not applicable.  However, for details of the tariff measure presented by the Productivity
Commission as a justifiable response, see Question 4.
9. If the measure is being extended, etc.
Not applicable.
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