From Mad Cow to Cash Cow

US - Russia's appetite for beef products has grown substantially and gone sharply upscale since it banned U.S. exports four years ago.
calendar icon 3 December 2007
clock icon 2 minute read
Before Russia banned U.S. beef in reaction to the discovery of a case of bovine spongiform encephalopathy, or mad-cow disease, it was the fifth-largest market for U.S. exports. But where citizens bought mostly cheaper meat products like livers, hearts and kidneys, they are now moving up the food chain to cuts like tenderloin.

Now the U.S. and Russia have nearly finished a new deal that domestic producers are counting on to generate millions of dollars in sales.

Richard Crowder, former chief agriculture negotiator for the U.S. trade representative, said: "We've got this down to a minimal number of issues. We're going to get this done." Mr. Crowder is now a consultant and negotiator for the USTR.

U.S. exporters can legally export beef to Russia, but only under a November 2006 agreement that applies burdensome restrictions on what can be sent. No shipments to Russia have been made under that deal, but at least one sale was recently struck, according to U.S. government and industry officials. The new deal would lift the restrictions, making trade flow much less onerous.

With rising oil revenue, Russia has been importing much more of the pricier cuts like rib-eyes, getting them from places like Brazil, Argentina and Australia, according to the U.S. Meat Export Federation.

Russia's beef imports in 2001 totaled about 640,000 metric tons, according to U.S. Agriculture Department data. The latest government forecast for 2007, released in February, shows Russia was expected to buy more than one million tons.

Source: Wall Street Journal
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