March 1, 2006

Russian poultry producers seek 30-percent cut in 2006 import quota

Russian poultry producers plan to ask the government in the near future to cut this year's import quota for poultry by 30 percent, said Ivan Obolentsev, president of Optifood company and member of the council for monitoring meat and poultry imports on Tuesday Feb 28.

The council, set up by the Agriculture Ministry and the Economic Development and Trade Ministry, made the decision to appeal to the government Tuesday.

The decision was made amid lower demand for poultry abroad due to fears of a bird flu epidemic, Obolentsev said. Demand for poultry has dropped 30-60 percent in some European countries, including in Austria, Germany and Italy, Obolentsev said.

The Russian market is flooded with poultry, Obolentsev said, naming the increase in domestic poultry production and imports as the reasons behind this. Domestic poultry production rose 18.5 percent on the year in 2005, Obolentsev said, without providing an absolute figure. Imports of poultry also rose, following an agreement on the trade of poultry and meat signed by Russia and the US in 2005, Obolentsev said.

The price of poultry dropped to a historic low level of about 30 US cents a kilogramme on foreign markets, Obolentsev said. In April the price of imported poultry at the port of St Petersburg is expected to hit below RUB22 (US$0.78) per kilogramme, while the production cost of domestic poultry stands at over RUB30/kg, Obolentsev said.

The Economic Development and Trade Ministry said Monday that the price of poultry fell 1.2 percent in January, due to higher volumes of imports and lower demand amid fears of a bird flu epidemic.