Washington - High shipping costs could stop the United States from donating several hundred thousand live hogs to Central America, as some farm groups have proposed, a U.S. Agriculture Department aide said on Tuesday.
“That's an option that was looked at and is still under review, but an obvious question that arises is the cost involved,” Tim Galvin, special advisor on trade to USDA Secretary Dan Glickman said.
At current low hog prices, “you could envision a situation where it costs much more to send the hogs down there than the hogs are actually worth,” Galvin said. “But it's an option (to help boost U.S. hog prices) that's still under review.”
Galvin also noted that logistical problems make pork donations an awkward tool for trying to reduce excess U.S. supplies that are depressing prices.
“Meat products don't really lend themselves often to typical donations” because many developing countries lack the infrastructure for proper handling, he said.
“It works in Russia, where they're used to handling the product,” Galvin noted. But in most developing countries, “grain products work better,” he said.
But even without donations, U.S. pork exports have been strong this year. “Volume is way up,” Galvin noted. “Commercial exports right now are one of the few bright spots in the pork outlook.”
On a related issue, Galvin said the United States will continue to pressure Canadian officials to help resolve a packing plant strike that is contributing to a heavy flow of Canadian hogs into the U.S. market.
However, the United States is unlikely to take stronger action aimed at limiting the hog imports, he said.
“I think the labor issue will continue to be the focus -- trying to make sure that Canada is taking all the steps that they can to keep more of the hogs at home and slaughtered and processed up there,” Galvin said.
Last week, Glickman talked with Canadian Agriculture Minister Lyle Vanclief by telephone and urged him “in the strongest way” to help resolve the strike at the Canadian packing facility, Galvin said.
USDA officials have estimated that resolving the strike would reduce Canadian hog shipments to the United States by as much as 25,000 head per week. Total Canadian hog shipments to the United States this year are expected to exceed 4.0 million head, up from about 3.1 million in 1997.
On another issue, Galvin said USDA was still optimistic that the South Korean government would soon clear the way for a new USDA export credit program in fiscal 1999.
Glickman has promised to make sure that pork is included in a new export credit package for South Korea.
However, that package has been on hold while USDA waits for South Korea to extend its sovereign guarantee that all loans taken out under the program will be repaid.
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