In poultry war, Russia has a leg up on U.S.
Sunday, October 31, 2010; 9:03 PM
Bush legs are back, if you can find them.
Once, long ago, U.S. chicken imports were at the top of the market here, plump and yellowish at a time when Russian chicken tended to be scrawny, bluish and scarce. This was the early 1990s, to be precise.
Back then nearly a million tons of leg quarters flowed across the Atlantic every year - chicken parts that don't command very high prices in the breast-meat-craving United States, but that nicely filled a Russian preference for dark meat. And they were cheap. Russians liked them so much that they took to calling them "Bush legs," after the first President Bush.
But in the new pecking order, they come in close to the bottom. For the first nine months of this year, they were banned outright, on the grounds that the chlorine disinfectant used by U.S. producers is unhealthy. Now, after a relentless full-court press by the U.S. industry, and hard-nosed bargaining over Russia's entry into the World Trade Organization, they're coming in again, washed with a different antimicrobial solution. But Russian shoppers complain about their water content, and worry, after a campaign in the Russian press, about hormones and antibiotics.
You won't find Bush legs in the supermarkets of Moscow or almost any other major city. Who gets them? Poor people in the boondocks, schoolchildren and patrons of fast food restaurants that sell chicken. (Except not one of the largest chains, Rostik's-KFC, which despite its U.S. affiliation says it sells only Russian chicken.) Go to a wholesale market here, with enticing displays of Russian and Brazilian chicken, and if you ask around enough a sullen vendor will eventually pull a 15-kilogram box of U.S. chicken out of the back freezer.
A lot of Bush legs are likely to end up as processed ingredients in other foods.
"The customer thinks he's eating a Russian sausage, when in fact he's eating an American chicken leg," exclaims Sergei Lisovsky, a member of the upper house of the Russian parliament who founded one of the country's largest poultry producers.
Lisovsky, a onetime nightclub entrepreneur and political operative, is not a fan of the American bird. He says Americans are dumping legs here, at less than cost, because they can't sell them at home. They drove the old poultry factories out of business in the 1990s. But now Russia can feed its own, he says, and should stop accommodating Americans just because it wants to join the WTO. Also, he says, with brand new factories and strict health requirements, Russia produces a better-quality product.
Yes, there was that survey by the Consumer Rights Protection Society, which found in June that eight out of 10 samples of domestic chicken purchased in Moscow carried salmonella. But that was misleading, he says. Most of it probably came during shipping and handling. Not the factories' fault.
There's a reason, says Andrei Teryokhin, executive director of the Association of Russian Poultry Meat Operators, that no one anywhere in the world eats chicken sashimi - and that reason is salmonella. It's a question, as he sees it, of educating Russian consumers on safe handling.
The government says Russia still needs to import more than half a million tons of chicken a year, 14 percent of total sales. Lisovsky says that's about a half million tons too much and accuses the government of inflating its estimate to keep on the Americans' good side.
On the other hand, U.S. producers point out that they lost about $400 million in Russian sales because of this year's ban, which followed several others over the past decade-bans that coincided with the revival of Russia's domestic poultry business.
Deep-frozen American chicken, now arriving from 18 plants that stretch from the Eastern Shore to Georgia, really doesn't compete with the fresh whole birds that are the mainstay of Russian production, says James Sumner, president of the U.S. Poultry and Egg Export Council. "They have very little to do with each other," he says.
A chicken is a chicken, say the Russian producers. They point out that the wholesale price of chicken dropped 5 percent when the first shipload from the U.S. cleared customs on Oct. 1.
Both sides have an eye on the import quotas the government will set for next year. But Sergei Yushin, head of the National Meat Association, says he believes Russia will continue to be a good customer for U.S. producers, in part because Russians like dark meat so much. "At least in the next 10 years," he said, "we cannot change the number of legs or wings or heads of a chicken."
Sumner acknowledges that U.S. exporters compensated during the Russian ban by finding other markets for chicken leg quarters. But now that they're back in Russia, they want to stay there - especially because China, which has been the other big U.S. export customer, just instituted its own ban. China had been buying chicken feet, which U.S. producers were only too happy to sell, there being no market at home. Now the Chinese accuse the Americans of dumping, while the Americans believe they're fairly retaliating for U.S. tariffs on tires and steel.
"Unfortunately, poultry often gets used as a political pawn," Sumner says. "It's a visible commodity. Maybe they think our industry has more clout than it really does. But it gets attention."