Meat + Poultry - April 2004 - 3

Canada initiates B.S.E. bailout
plan

E.R.S. lowers poultry
trade outlook

LETHBRIDGE, ALBERTA - Canadian Prime Minister Paul Martin and Agriculture and AgriFood Minister Bob Speller announced C$995 million in assistance for Canadian farmers facing financial challenges brought on by the discovery of bovine spongiform encephalopathy.
"The Canadian cattle and beef industry is a real success story, but it has been devastated
by extended border closures, which are beyond its control," said Prime Minister Martin. "The
government is providing the industry with assistance to help producers manage until borders
are fully reopened."
"Farm income across Canada dropped to historic lows in 2003, affecting all commodities,"
said Speller. "Canadian farmers face these unprecedented challenges at the same time that
they are moving to a new permanent income and disaster assistance program. The funding
will not only help Canadian cattle producers through a difficult period, but also the whole of
the agriculture sector, which has weathered a number of shocks and unforeseen events in
the past couple of years."
The Transitional Industry Support Program will provide a total of C$680 million to cattle
producers who have faced a prolonged closure of the Canada-U.S. border. The funding will
be delivered as a direct payment of up to C$80 per eligible bovine on inventory as of Dec. 23,
2003. Eligible animals will include all bovines except mature bulls and cows (cows that have
calved and intact bulls older than one year). Similar measures will be available for producers
of other ruminants who have lost access to the U.S. market.
The program will also provide C$250 million to producers of all eligible commodities, including the cattle industry, across Canada. An additional C$65 million is earmarked to cover
the federal government's share of the shortfall for the 2002 claim year under the Canadian
Farm Income Program. C.F.I.P. is cost-shared on a 60:40 basis by federal and provincial governments. In the 2002 program year, claims to the program exceeded the amount available,
due in large part to drought conditions in western Canada.
While government officials are trying to get the Canadian cattle industry's economic situation under control, they are also lobbying U.S. officials to get the U.S.-Canadian border open
as soon as possible. In late March, Minister Speller met with U.S. Secretary of Agriculture
Ann Veneman to discuss the opening of the border to trade.
"I expressed again to Secretary Veneman our hope that the border reopens soon to Canadian cattle and other live animals," said Speller. "I thanked her for moving forward with the
process that could make this happen and emphasized the importance of an open border to
both Canadian and U.S. industries."
The U.S. Dept. of Agriculture reopened the comment period this past March on a rule that,
if finalized, would clear the way for live Canadian cattle under 30 months, other live animals
and a broader range of animal products to enter the U.S. for the first time since May 20, 2003.
"Science indicates there would be no greater risk of B.S.E. in the U.S. if the border reopened
fully to Canadian live animals and animal products," said Speller. "Canada and the U.S. have
relied on science in making changes to our respective regulatory systems and we anticipate
the U.S. will use this same sound science in making decisions related to the border."

WASHINGTON, D.C. - The discovery of Avian Influenza in several poultry flocks throughout the U.S. has altered the outlook for the
export of poultry, according to the U.S. Dept.
of Agriculture's Economic Research Service.
There have been outbreaks in Delaware,
New Jersey, Pennsylvania, Texas and Maryland. The growing problem has led to several
countries banning the import of U.S. poultry
The current assumption is that the countries currently banning all U.S. poultry shipments will, over time, eventually target specific states, provided there are no further
outbreaks of A.I. The timetable for this regionalization process will vary from country
to country.
Mexico recently announced that some
exports from the U.S. could resume. There
are restrictions on what products specified
states can export to Mexico and on the storage of poultry products in Texas before entering Mexico. Due to the number of bans or
restrictions placed on the export of broiler
products, the forecast for broiler exports was
lowered to 4.96 billion pounds from the previous forecast of 5.28 billion pounds.

U.S.D.A. approves seven B.S.E. testing labs

Tyson expanding
pork facility

WASHINGTON, D.C. - The U.S. Dept. of Agriculture's Animal and Plant Health Inspection Service has approved seven state laboratories to assist in the government's increased surveillance
of bovine spongiform encephalopathy. The laboratories are part of an existing network of 26
state labs and one federal lab that assists APHIS with animal disease testing when necessary.
The following laboratories will receive federal funding (as much as $500,000 each) for
rapid testing equipment: California Animal Health and Food Safety Lab System, Univ. of
California-Davis; Colorado State Univ.'s Veterinary Diagnostic Laboratory; Texas Veterinary

Smithfield finalizes
sale of Schneider
SMITHFIELD, VA - Officials with Smithfield
Foods expect the sale of Schneider Corp.,
Kitchner, Ontario, to Maple Leaf Foods, Toronto, to be completed this month. It is estimated that Maple Leaf is paying Smithfield
$378 million for the company. The money
from the sale will be used by Smithfield to
help repay the loan the company used to acquire Farmland Foods this past October.

STORM LAKE, IOWA - Tyson Foods, Inc.,
Springdale, Ark., is expanding the firm's pork
processing plant in Storm Lake. The expansion will include 14,000-square feet of additional cooler and storage space.

Continued on Page 4
APRIL 2004

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