October 8, 2010

US poultry sector leaders call for less dependence on Russian market

US chicken companies need to stop counting on Russia as a market for dark meat as the country continues to build up its own local protection and push foreign companies away, US industry leaders said.

The US needs to "start believing" Russia when officials there say "they really do want to be self-sufficient in poultry," said Donnie Smith, president and chief executive of Tyson Foods Inc. (TSN).

Russia has historically been a major buyer of dark meat, but in recent years Russia has begun lowering its quota for US product and sporadically banning imports from the US.

Smith and Mike Roberts, president for the food products division of Perdue Farms, said US producers need to begin finding new markets for dark meat chicken that is less popular than white meat in the US.

"I think we'll be stronger by not having the dependence on Russia," Roberts said. He and Smith spoke today at a national Chicken Council meeting.

Russia lowered its 2010 quota for US chicken to just 450,000 tonnes, down from 750,000 tonnes in 2009, but until recently the US hasn't been able to ship any because of a lengthy Russian trade ban.

The first shipments of US chicken to Russia this year have just begun and product should begin arriving at ports there any day now if it hasn't already, National Chicken Council spokesman Richard Lobb said.

On January 1, Russia announced it would no longer allow imports of any chicken processed with chlorinated rinses, a sanitisation method used by all major US processors at the time. The USDA has now pledged to Russia that it will certify that US chicken shipments are sanitised by one of three methods that don't use chlorine and are approved by Russia.

Russia was the largest foreign market for US chicken exports before the ban. According to statistics maintained by the US-based National Chicken Council, US exporters shipped about US$744 million worth of chicken to Russia in 2009.