It's a game of political chicken, and U.S. poultry producers are caught in the middle.
Russia, the top market for U.S. chicken exports, will be banning imports from at least 19 plants on Monday. While U.S. producers say these bans won't have much impact, they wonder if there are more bans to come _ which could further dampen an already weak industry.
On Thursday, Russian Prime Minister Vladimir Putin announced the bans in an interview with CNN, citing what he said were ignored warnings about inspections.
Companies affected, including Tyson Foods Inc., the world's largest meat producer, are vowing to right any wrongs, if need be. The industry's trade group said it had been expecting Russia to reduce imports anyway, as the country's own production rises. It downplayed any threat to the U.S. industry.
But still, Russia is a key market for U.S. chicken producers at a time when they're seeing profits squeezed by high costs for grain and fuel and a U.S. market so oversupplied it's keeping prices low.
In the first half of the year, U.S. producers shipped $395.7 million worth of broilers to Russia. That was up 42 percent from the previous year, while volume grew 20 percent.
Plants affected include at least two owned by Tyson, two from Sanderson Farms Inc., the nation's fourth-largest chicken producer, a Jennie-O Turkey plant owned by Hormel Foods Inc., and other companies.
The U.S. Department of Agriculture said in a statement Friday that Russian objections "are not consistent with standards and food safety policies in the United States" and international ones. It said the facilities comply with U.S. food safety regulations.
Putin has said the move has nothing to do with tension over the recent fighting in Georgia and was purely economic.
But Mike Cockrell, chief financial officer of Laurel, Mississippi-based Sanderson Farms, doesn't see it that way. Russia has banned U.S. poultry before, and sometimes it comes during times of political tensions, he said.
"It appears chicken is still being used as a political tool," he said.
The bans starting Monday won't hurt business, he said, because production at the two affected plants _ both in Mississippi _ can be shifted to at least two other plants approved by Russia.
But the big concern, he said, was if Russia started banning more plants. He said based on comments this week _ including the country's top agriculture minister saying it wanted to cut poultry and pork imports by hundreds of thousands of tons _ anything is possible.
Russia also issued a cautionary statement to 29 other U.S. plants, saying their products showed levels of certain substances higher than Russia allows, according to the U.S.A. Poultry & Egg Export Council, an export arm for the industry.
Cockrell said Sanderson would address the issues Russia has cited, as did Little Rock, Arkansas-based Tyson Foods. Julie Craven, a spokeswoman for Austin, Minnesota-based Hormel said the company would work with Russian officials and hoped to resolve the issue in the coming weeks.
