Another and more current trade grievance arises from the quotas the Bush administration has placed on foreign steel imports. The first response to the quotas has been levied on a sizable U.S. agricultural export sector, and the impact of the response could be far-reaching.
Russian officials have declared they will not lift the ban until their demands are met. Secretary of agriculture Ann Veneman has said the discussion is at an impasse.
Neither the U-S or Russia is citing U-S tariffs on steel as a reason for the poultry ban, but evidence is mounting that the two events may not be completely independent. Economic losses due to the poultry ban will cost roughly 600 million dollars a year, about the same amount as the steel tariffs. And, this week, the former Soviet republics of Kyrgyzstan and Moldova announced plans to ban U-S poultry citing the same health concerns as Russia. And, like Russia, both are exporters of steel to the U-S.
Regardless of the reasons for the ban, the loss of the largest U-S chicken export market is likely to have widespread impact. Retail chicken prices in Washington D-C plummeted due to a sudden ban-induced product glut. Dropping prices at the store could mean lower prices for producers in the 38 states who raise the birds. Continued price pressures could cause production to fall off, causing the feed market to shrink. The ripple effect of a long drawn out ban would likely cause grain markets to sag.