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CME: Russia, US to Finalise Agreement on Chicken

by 5m Editor
18 March 2010, at 7:24a.m.

US - Russia’s chief sanitary official said on Wednesday that the rumored agreement between Russia and the US regarding chicken imports could be finalised this week., write Steve Meyer and Len Steiner.

Russia’s chief sanitary official said on Wednesday that the rumored agreement between Russia and the US regarding chicken imports could be finalised this week. Gennady Onnischenko said the agreement could be completed by week’s end but cautioned that this did not mean that shipments would resume in the near future. The story agreed with what we have been hearing in that US exporters will limit the amount of chlorine in the water being used to process chickens. The Russians also stated that the amount of fluid that separates when chicken is thawed must not exceed 4 per cent of the total weight of the product.

This confirms market sentiment for the past few weeks and should keep chicken prices firm. Weekly average leg quarter prices have stayed between 35 and 38 cents/lb. all year in spite of this potentially devastating trade spat. Weekly average 12-city composite broilers reached 82.59 cents/lb. last week, their highest level of the year to-date.

In addition to the Russian chicken news, Reuters reported today that top US trade officials are in China to again attempt to finalize an agreement that would actually allow US pork to begin flowing directly into China. China announced in October that they would drop the import restrictions related to H1N1 influenza but nothing has happened yet because the specific conditions have not been agreed upon. Recall that we and many others believe that the H1N1 pork restrictions were actually retaliation for the US Congress’s blocking USDA from inspecting Chinese chicken plants to clear them to export cooked chicken to the US Congress reversed that position last fall but, to our knowledge, no inspections have occurred. We do not think China will wait until inspections actually start before resuming pork imports but they have certainly done a good job of dragging their feet so far.