Russia Audit Of US Pork Plants Sparks Worry Over Trade

1:16 PM, November 14, 2008

By Bill Tomson

Of DOW JONES NEWSWIRES

Agriculture Online

WASHINGTON (Dow Jones)--Russia, after months of strong imports of U.S. pork

this year, sent a team of auditors to production facilities here in October,

prompting concern among U.S. government and industry officials that Russia

might bar some of them from exporting.

Russia has cut the flow of U.S. agricultural exports after similar audits.

And according to U.S. Department of Agriculture officials who asked not to be

named because the audit findings haven't been released, there is reason for

concern that U.S. pork producers could be barred after this latest audit.

"The Russians are looking for ways to restrict imports," one USDA official

said. "One of the things they do - they come over here, sending inspectors to

the U.S. to inspect our facilities."

Russia and the U.S. have butted heads often over the past several years on

poultry trade. Russia blocked exports from U.S. poultry plants in 2003 and 2004

after they said they found violations during inspections of U.S. production

facilities. In 2006 Russia reorganized its licensing system for poultry imports

that threatened to stop all trade.

Russia possibly won't "de-list" any U.S. pork plants, but the fear is real,

another USDA official said. Producers here have December contracts to fill, and

there's no word back yet from Moscow on the results of the audits.

The Russian audit team visited 29 U.S. pork plants during the second half of

October, USDA spokeswoman Laura Reiser said. "This was a routine audit that

other countries also do. We do that same in countries that export to the U.S."

If Russia does want to limit its imports of meat to the U.S., pork is a prime

target, according to data maintained by the National Pork Producers Council.

In August alone, the U.S. sold 17,009 metric tons of pork to Russia, making

the January-August eight-month total 96,084 tons. And that is nearly double the

yearly tariff-free quota of 49,800 tons allowed by Russia.

Industry representatives say U.S. pork sales to Russia have tapered off over

the past couple months because of the rising strength of the dollar against the

ruble and the global financial crisis.

Nick Giordano, vice president and counsel on international trade policy for

the National Pork Producers Council, said he expects the trade environment to

improve over the coming months, but he also expressed concern over the Russian

audits of U.S. plants last month.

Giordano said he wasn't aware of any problems but that sometimes "politics

enter into" the audit results.

The "exit interview" conducted with Russian auditors after they had visited

the U.S. pork plants "went real well," said a USDA official involved in the

process, but that isn't necessarily a good sign.

"We don't view that as a positive," the USDA official said, "because the

people that did the audits are not going to write the findings report. We're

fearful they're going to try to ... not allow certain plants to ship to

Russia."

-By Bill Tomson, Dow Jones Newswires

agriculture.com