RUSSIA TO IMPOSE NEW RESTRICTIONS ON U.S. POULTRY EXPORTS?

A high-profile trade row between Russia and the United States looks set to continue this week following moves by Moscow that only partially lift a ban on imported U.S. poultry products. In a joint statement published on April 13, top Bush administration trade officials had publicly welcomed what they thought was a satisfactory resolution to the poultry dispute, and looked forward to the ban being almost completely lifted beginning yesterday. Instead, however, reports out of Moscow over the past several days have suggested that import restrictions will continue to keep the Russian domestic market closed to up to 25 percent of U.S. poultry exports. More disturbingly for the American side, there were indications yesterday that Russian authorities had thrown up a new barrier to U.S. chicken exports even as the earlier one was being partially lifted. The English-language Moscow News quoted Russian Agricultural Ministry sources today as saying that they had canceled all permits for Russian imports of American-produced poultry. The U.S. embassy reportedly expressed its surprise at this announcement, and said that it had “no information regarding actions that the Agricultural Ministry may be taking against Russian importers of U.S. poultry.”

The Russian ban on American poultry was first imposed on March 10 in a move that many observers saw as retaliation for the Bush administration’s March 5 decision to impose tariffs on some Russian steel exports to the United States. Because of the trade revenues involved–American poultry producers from some thirty-eight states export products worth about US$700 million per year to Russia–the issue quickly emerged as perhaps the most serious irritant in bilateral Russian-U.S. relations and a potential irritant in next month’s scheduled Russian-U.S. summit meeting. On March 31, however, the two sides signed a protocol agreement under which the poultry ban would be lifted as of April 10 so long as U.S. poultry exporters met a series of requirements set out by the Russian government. But while Bush administration officials welcomed the protocol as a resolution of the poultry dispute, some of their Russian counterparts suggested that the row was far from over (see the Monitor, April 3).

The events of the past week appear to have borne that warning out. On April 10 the Russian Agricultural Ministry said that it would need some time to study the 300 or so pages of documents that U.S. producers had submitted, and moved the date for lifting the ban back several days. Subsequent Agricultural Ministry statements suggested that the U.S. side had satisfactorily met the requirements, and it was these statements that led the U.S. trade officials to proclaim the trade dispute a thing of the past.

Other voices in Moscow, however, expressed continued unhappiness over the U.S. response. These included First Deputy Agricultural Minister Sergei Dankvert, who on April 12 was quoted as saying that the United States had fulfilled only two of the twelve conditions. Indeed, the ministry’s mixed signals appeared to reflect the intense political pressure building up over the trade dispute. Domestic Russian resistance to the poultry ban being lifted showed itself when the State Duma unanimously adopted a nonbinding resolution urging the government to both extend the ban and enact a program that would encourage domestic poultry farmers to increase production.

Against this background, it is unclear exactly how yesterday’s decision will impact the Russian-U.S. poultry trade. Initial reports, however, have indicated that chicken products from producers in four states–North Carolina, Virginia, Maine and Pennsylvania–will continue to be banned for six months on the basis of claims by Russian inspectors that they had found diseased chicken there. In addition, products from some fourteen other U.S. poultry plants–said earlier this month to have exported salmonella-tainted chicken to Russia–will also remain subject to the ban. In all, between 20 and 25 percent of the roughly 1 million tons of poultry that America exports annually to Russia will reportedly still fall under the import ban.

But Russian agricultural officials have made it clear that other steps will also be taken to regulate imports from American poultry producers. Dankvert, for example, told reporters yesterday that Moscow remained dissatisfied with the quality of U.S. chickens. Authorities, he continued, would introduce new, stricter requirements over the next several months. These, he said, would among other things include gene and antibiotics analysis and closer regulation of Russian poultry importers. Russia could also reimpose the ban if the quality of U.S. poultry imports were to fall. Dankvert’s remarks followed a statement by Agricultural Minister Aleksei Gordeev on April 13 alleging that the United States uses double standards in regulating poultry production–one of high standards for domestic consumption and considerably lower standards for products shipped abroad (AP, April 12, April 15; Reuters, April 13; AFP, April 14; Moscow Times, Wall Street Journal, Izvestia, April 15).

American officials, who have sharply rejected charges leveled by Moscow regarding the quality of American poultry products, are likely to be concerned by this long list of conditions that Moscow will apparently set. But Washington will presumably inquire most urgently into the reports published yesterday indicating that the Agricultural Ministry has canceled all existing permits for Russian poultry importers and will require them to apply for new permits under what is being described as the introduction of a new veterinary certificate for poultry. And while the ministry reportedly did not say how long it would take to process paperwork for the new permits, a manager for one poultry importer was quoted today by the Moscow Times as saying ominously that “This is death. It used to be a very demanding procedure, and the time needed to get permission has always depended on the mood of the veterinary inspectors” (Moscow Times, April 16).

Russian Economic and Trade Minister German Gref, meanwhile, was scheduled to launch a new round of talks in Washington yesterday regarding the U.S. tariffs on Russian steel (Strana.ru, April 15). Officials in Moscow have avoided explicitly linking the steel and poultry disputes, but it is not beyond the realm of possibility that the threat of new restrictions on U.S. poultry products voiced by Russian officials this week is intended at least in part to gain Moscow some leverage in the steel negotiations. Russian and U.S. diplomats and government officials have moved with increased urgency over the past week or two to begin resolving an array of disputes that threaten to sour next month’s presidential summit meeting, and a trade agreement of some sort would give an additional boost to that effort.

INCUMBENT GOVERNORS WIN IN LIPETSK AND PENZENSK OBLASTS.