Delays to the setting of poultry import quotas in Kazakhstan are forcing US products out of the market and benefiting Russian competitors, according to US industry representatives.
The Kazakhstan government traditionally only sets around 20% of quotas at the beginning of the year, with the remaining 80% set at the beginning of March. However, for the last two years, the country has been delaying the introduction of the remaining quota until August.
This means the US – which usually has a total yearly quota of around 110,000t of poultry – had a quota of just 22,000t in the first six months of 2012, forcing exporters to exceed the quota and pay high Customs duties.
Experts warn this is forcing US product out of the market, to the benefit of Russian producers, who have free access to Kazakhstan’s poultry market, thanks to Customs Union trade agreements. They add that, during the first six months of the year, Russian producers tried to maximise their exports to the country with the hope of meeting the demand of local consumers, so there was less demand for US poultry.
Regional consultant of the US poultry and eggs export council (USAPEEC) for Ukraine, Moldova and Central Asia region Bella Ablaeva told Globalmeatnews: “I would not call this unfair competition or some kind of conspiracy, but there exists a tendency towards an increase in Russian products in the Kazakh poultry market, and a reduction of the volume of these products from the US. Clearly, within the Customs Union, the member states are primarily aimed at developing trade between each other, and Kazakhstan and Russia have always set their heart on this. And every year the volume of turnover [between them] is only growing, but I would not want this growth to be achieved due to a delay in the issuance of quotas to third countries.
“If, in 2010, the quotas were issued in accordance with the planned timetable, than in the next two years there were great delays. Quotas for 2012 (80% of quota) were released only at the end of August, four months before the end of the year [a delay of 4.5 months]. Of course, during this period Russian poultry producers intensified their role on the market. And it is tempting even Kazakhstan importers to think that such a delay was not accidental.”
She added that Kazakhstan was a strategically important market for US poultry, but American exporters have been gradually losing ground in the country since 2010.
“Kazakhstan is one of the biggest markets for the US poultry. America does not only make use of the entire quota for Kazakhstan – 110,000 tonnes (t) – but also exports above the quotas. Around 20-30,000t are exported above the quota annually. Until 2010 (before the introduction of the quota within the Customs Union), the US imported about 150,000-170,000t annually. And the country could provide this volume and even more if it were not for the quotas, especially given that American chicken is competitive on price,” she told Globalmeatnews.com.