Russia, the largest importer of the US poultry products has amended their five-year bilateral poultry and pork trade agreement with the US. Though the new poultry quota for 2009 has reduced from 931,500 to 750,000 tons, the US will get a reprieve till 2010 to fully implement the chlorine-less chicken treatment. Similarly, the pork exporters also have something to cheer about as the quota for the same has been doubled from 50,000 tons to100,000 tons.
It should be recalled that the Georgia conflict in August had strained ties between both countries in recent times. This has allegedly reflected on the US poultry exports to Russia that barred imports from many US producers. Subsequently, Russia had stated that inferior quality and higher chlorine levels had forced them to take such a decision, thus ruling out any political ramifications to it.
The president of USA Poultry & Egg Export Council James Sumner stated the increasing investments in poultry industry by the domestic players have reduced demand for the US poultry products in Russia. The chicken production in Russia is reported to be growing at a rate of more than 15 percent for the past several years, though it marked a decline this year due to higher prices of animal feed and economic slowdown.
Sumner said the deal is a boost to the failing poultry industry which is in turmoil owing to fluctuation in commodity prices that reduced profit margins of the producers. Close to a quarter of the US poultry production found their way to overseas markets, and since the country is in recession, exports are key to every industry in the US.
The deal will remove temporarily the ban on the use of chlorine in the processing of poultry meat. However, the use of frozen poultry meat for manufacturing into any type of food products will be another hurdle the exporters will have to face in two years’ time besides chlorine treatment during production process.
Nevertheless, the US stock markets witnessed increased interest in poultry shares in response to the new development. The shares of Smithfield, the largest pork producer of the US, closed at 9.5 percent higher and Tyson Foods shares saw a rise of 9.2 percent respectively on Tuesday.