A Russian ban on imports of Canadian pork and other agricultural products announced last week is not expected to have a major impact on Canadian pork prices or markets.
Russian prime minister Dmitry Medvedev last week banned imports of cattle, hogs, beef, pork, poultry and a range of other products from Canada in response to sanctions imposed over Russia’s actions in Ukraine.
Canada exported $213 million worth of pork to Russia in the first five months of this year and was on track to ship more than $500 million worth in 2014.
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That would have surpassed export value totals for 2012 and 2013, which were $492 million and $260 million, respectively.
The onus will now be on Canadian pork processors to find other markets for product, according to Canadian Pork International president Jacques Pomerleau.
He said six Canadian processors have the necessary approvals to ship pork to Russia, or did until the ban. Three of those are in Western Canada: Maple Leaf in Lethbridge, Olymel in Red Deer and HyLife in Neepawa, Man.
Both Olymel and Maple Leaf issued news releases last week saying they will make efforts to find new sources for Canadian pork.
In the short term, the processors must negotiate the delivery or diversion of millions of dollars worth of frozen pork already en route to Russia.
“We are tracking and trying to understand the impact on some of the product that is in various stages of transit,” said Canadian Pork Council spokesperson Gary Stordy.
He said there are hundreds of containers involved, in addition to product ordered by Russia that has been set aside by processors at various Canadian locations.
Pomerleau noted this isn’t the first time Russia has created marketing challenges.
Last year, Canadian pork exports were disrupted for about six months when Russia banned meat from animals given ractopamine, a growth promotant.
Four years before that, it delisted Canadian processing plants, which then had to be inspected and recertified for product delivered to Russian markets.
“The packers were able to adapt in the past,” said Pomerleau.
“I don’t expect much (impact) on the producers because of how the price structure is built. And hopefully the sanctions won’t last too long.”
Canadian prices track those of the U.S., which exports less pork to Russia. Prices for producers could drop if pork accumulates at packing plants, although high demand makes that unlikely, said Manitoba Pork Council chair Karl Kynoch.
“We are in a time of very high demand for pork, so hopefully that will absorb some of this. The other thing is we have very high prices right now, which are the result of death losses in pigs in the U.S. and some provinces.
“We’re really keeping our fingers crossed that our packers can find other markets for this product sooner rather than later.”
Russia also imposed its ban on the U.S., European Union, Australia and Norway. That means it will have to access pork from Brazil or other countries, which Kynoch said could leave holes that Canada could fill.
Anecdotal reports indicate the price of pork in Moscow rose sharply last week on news of the import ban. Pomerleau said pressure from its citizens and lack of investment in Russia’s domestic pork industry could alter the one-year ban.
“Russia is desperately short of meat because they have African swine fever. Any discussion or any public speech saying Russian production will replace imports, well, that’s bologna, because the African swine fever is literally killing their industry,” said Pomerleau.
“Nobody’s interested in investing one penny in Russia.”
The Russian ban also applies to Canadian beef, but Rob McNabb of the Canadian Cattlemen’s Association said it is not a major market.
Tight global supplies for beef and beef products will ensure markets are found for any product once destined for Russia.
