Washington - The U.S. poultry industry still hopes to follow through with a demonstration project to help revitalize the Russian poultry sector, despite less than promising circumstances, a top industry aide said on Thursday.
After the rouble devaluation, “there were some concerns as to what our posture should be,” Jim Sumner, president of the USA Poultry and Egg Export Council, said. But board members voted unanimously to proceed with the project, which has been plagued by delays, he said.
Until August, Russia had been the top market for U.S. poultry exports, with shipments averaging close to 80,000 tonnes per month. The devaluation brought that to an abrupt halt and sales have only gradually recovered to about 20 percent to 30 percent of their former level, Sumner said.
But even before August, U.S. industry plans for a joint venture project in Russia to demonstrate Western poultry processing technology had hit an unexpected snag.
Last December, the USA Poultry and Egg Export Council signed an agreement to sell in Russia 36,000 tonnes of soymeal donated by the U.S. Agriculture Department to raise money for its demonstration project.
But the USA Poultry and Egg Export Council has been unable to find a Russian buyer. Initially, that was because soymeal prices were falling and buyers were waiting for the market to bottom out.
More recently, the rouble devaluation has made it “difficult to find anybody (in Russia) who can guarantee payment for delivery of any commodity,” Sumner said.
A U.S. team is in Moscow for talks on a possible U.S. food aid package. While the composition and terms of any U.S. aid is still up in the air, the U.S. poultry industry is leery of government-to-government donations.
“What we would like to see most would be a type of program to allow commercial sales to resume as quickly as possible,” Sumner said.
The U.S. industry fears that many Russian importers and distributors could be forced out of business by a donation program that sidesteps commercial channels that have been developed over the past several years, he said.
If donations are provided, “we want to see the program very closely monitored” so that food gets to those who are truly needy and not be diverted by “unscrupulous bureaucrats” who are trying to make a quick profit, he said.
Some in the Russian government and private sector would probably be happy to see U.S. poultry permanently shut out of the market, Sumner acknowledged.
“But what we've been to trying to demonstrate is that it's in their best interests to have both” imports and domestic production, he said.
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