Soviet-Style Trade Barriers by Russia Entangle Tyson, Sanderson Farms in High-Stakes Game of Chicken

The $38.5 billion US chicken industry has once again been trotted out as the proverbial straw man in Russia’s ongoing reluctance to join the World Trade Organization.

Russia’s accession to the WTO would guarantee a huge export market for US business without constantly facing the specter of impossible-to-predict trade barriers arbitrarily erected at the whims of the Kremlin.

This week, Senator Blanche Lincoln, Chairwoman of the Senate Agriculture Committee, and Ranking Member Saxby Chambliss called for the Russian government to end its foot-dragging on reopening its import market to US poultry, calling it "yet another obstacle to resumption of trade."

In June, President Obama and Dimitry Medvedev announced that they had agreed to end a Russian ban on US poultry; chickens are chilled in a chlorinated water bath during processing to kill harmful food-borne pathogens, which Russia objected to, oddly, for health reasons.

“I am pleased that we are not diluting the WTO talks with endless discussions about the fate of poultry anymore,” Medvedev said at the time.

Then, last week, the Russian Veterinary Service threw up another roadblock in the country’s path to WTO membership by requiring re-inspections of US poultry plants before allowing chicken to enter the former Soviet Union.

Toby Moore, Vice President of Communications at the USA Poultry & Egg Export Council, tells Minyanville that abrupt trade policy changes at the expense of the poultry industry is “not an overnight development.”

After the United States raised steel tariffs in 2002, Moscow put a ban on chicken imports. After Russia went to war with Georgia in 2008, Moscow again closed the door to US chicken, accusing America of secretly pulling the strings that instigated the turmoil.

Over the last three years, US poultry exports to Russia averaged more than $800 million annually, representing over 500,000 US jobs according to the Senate Ag Committee.

And now, as Yogi Berra famously said, it’s déjà vu all over again.

In a telephone interview, Moore explained that the same sorts of things have been going on since “we first started exporting chicken to Russia in the late 80s, early 90s.”

Moore says:
 

Soon after the fall of the USSR, when the ruble crashed and the George H.W. Bush administration started sending food aid shipments, including chicken leg quarters, during their food and cash crisis, the Russians developed a taste for them--they called them "Bush Legs." Exports took off after they got back on their feet economically. Then Russia set up a tariff rate quota for all imported poultry. The quota schedule was laid out in such a way that it would increase to a point and then decline as Russia’s own poultry industry began being able to supply their own needs. About two years ago, Russia started making noise about chlorine as an antimicrobial agent in slaughter plants, which has been an extremely safe and effective method, used for years and years here in the US. We thought the Obama-Medvedev agreement was the end of it. But the Russians just keep throwing up obstacles.

US poultry concerns are, pardon the pun, concerned. The Russian market is particularly important to the US poultry industry, as it is the largest foreign country that has a taste for the dark chicken meat that consumers don’t favor here at home. Moore says, “We export about 20% of our total weight by production and Russia is one of the top two export markets, who, along with China, make up about 40% of that 20%.”