President Vladimir Putin on Wednesday ordered government agencies to restrict imports of food and agricultural products for one year from any country that has issued sanctions on Russia, which includes the United States, among a number of other nations. The sanctions are a result of Moscow’s actions in the escalating tensions in Ukraine.
The Russian decree was being executed “with the goal of defending the national interests of the Russian Federation,” according to the order. Imports from nations that have sanctioned Russia will be banned or limited for one year. Although the decree did not specify the products that would be affected, it instructs the Russian government to establish a list of commodities to be restricted. The decree also instructs officials to ensure that restrictions prevent price increases and to establish market-control measures to increase supplies of domestic goods.
Following Vladimir Putin’s announcement Wednesday, Moscow clarified Thursday that the ban would include all meat, fish, dairy, fruit, and vegetables from the United States, the 28 European Union countries, Canada, Australia, and Norway.
“We have learned that poultry is one of the commodities to be included on the list. Russia is the second-leading market for U.S. chicken, in terms of volume. In 2013, the U.S. exported about 267,000 metric tons of chicken to Russia valued at $303 million. As its domestic poultry industry has expanded, Russia has in recent years become less important as an export market. Russia currently accounts for only about 7 percent of total U.S. poultry export volume. In the mid-1990s, exports to Russia were as much as 40 percent of that total,” according to a statement from the National Chicken Council and USA Poultry & Egg Export Council.
“As a result, we do not expect that a Russian ban on U.S. poultry imports will have a great impact on our industry. The biggest impact, we believe, will be on Russian citizens who will be burdened by higher prices for all food products, especially meat and poultry. The price of poultry in Russia is already rising and has recently been increasing at a rate of 2 percent to 3 percent per week. Our industry believes that free and fair trade – particularly with food – should never be used as a political bargaining chip. We look forward to working with the U.S. government to resolve this issue and resume normal trade relations with Russia as soon as possible,” NCC and USAPEEC said.
It is not yet known yet whether chicken on its way to Russia now will be granted entry.
As a result of Russia’s actions, U.S. and European officials may ask the World Trade Organization to block Russia’s ban on food imports. The Russian ban closes a market worth $1.3 billion to U.S. farmers and $15.8 billion to European exporters last year. “The sanctions that the United States has imposed comply with our international obligations. By contrast, Russia’s move to ban agricultural goods from the United States and the European Union appears to have no grounding in the WTO rules governing international trade,” Office of the U.S. Trade Representative spokeman Trevor Kincaid said. “We will monitor the situation and take actions as appropriate.”
“Politically motivated large-scale trade restrictions are a direct violation of WTO rules, which Russia pledged to comply with,” European officials said. “These measures will be thoroughly analyzed, and then relevant claims with be submitted with the WTO.”
Russia is the fifth-larges importer, accounting for about 2.7 percent of global trade, according to World Trade Organization figures for 2012 that rank its purchases behind the European Union, China, and Japan. Imports of food and raw agricutlural materials were valued at $43.1 billion last year, with $36.9 billion from countries outside of the former Soviet republics in the Commonweath of Independent States, according to Federal Customs Service data.
