December 6, 2012

In case the congress cancels the Jackson-Vanik amendment, the US will be able to double soy shipments to Russia.

This is according to both Russian and US experts.

In the 2011-12 marketing year, the US shipped 30,000 tonnes of soy and 25,000 tonnes of soymeal to Russia.

The Senate may consider legislation changes, within the next week or two, allowing US exporters normal trade relations with Russia. If the changes go through, exports may double, said Danny Murphy, first vice president of the American Soy Association.

As part of WTO, Russia agreed to eliminate its import duty on soymeal in 2014 from 5%, Tamara Pashchenko, deputy managing director of Russia's Oil and Fats Union in Moscow, said Tuesday (Dec 4). The Oil and Fats Union members account for 85% of vegetable oil production in Russia. There is no import duty on soy, she said.

"Russia's soy market is expanding because of a growing consumption by livestock farms," Dmitry Rylko, general director of the Institute for Agricultural Market Studies, said by phone from St. Petersburg Tuesday (Dec 4). However, he also said that growth of internal production could hamper the development of US exports.

Russia is importing soy mostly from Brazil and Argentina, where prices are lower than in the US, Rylko said. Russia's soy and soymeal production is increasing "aggressively" and will start competing with imports soon, he said. "Our US colleagues may find it not so easy to penetrate the Russian market given these factors," Rylko added.