CHICAGO -- Russia's ban on Western meat imports, in response to sanctions imposed for its role in eastern Ukraine, contributed in part to increased U.S. pork and poultry warehouse inventories in August, an analyst says.
Bob Brown, president of Robert A. Brown Inc. in Edmond, Okla., made the comments following the U.S. Department of Agriculture's monthly cold storage report on Sept. 22. The report showed August pork inventories totaled 546.3 million pounds, up 2 percent from July and down slightly from a year ago.
Ham, which totaled 179.4 million pounds, accounted from most of the total pork stock increase with bone-in ham up 24 percent from July and a 17 percent boneless ham gain.
Total pork rose roughly 10 million pounds more than usual in August, and virtually all of that was boneless hams, Brown says.
"Part of that had to do with the U.S. that in June and July had just started shipping hams to Russia after several months of not doing so because they had previously barred it," he says.
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In June, Russia lifted its initial ban on U.S. pork imposed last year over the use of the feed additive ractopamine that promotes lean muscle growth in hogs.
But the sizable increase in boneless ham from July to August might have been diluted somewhat by processors and retailers putting more of them in storage in perpetration for the winter holidays, Brown says.
U.S. pork exports to Russia in 2013 totaled 17.2 million pounds, compared with 275.2 million the year before, according to USDA data.
Chicken stocks in August totaled 616 million pounds, with the biggest increase, other than hens, traced to leg quarters that at 127.2 million pounds were up 6 percent from July, according the USDA storage report.
Brown pointed out that Russia was a popular destination for U.S. leg quarters that ultimately were drawn into Russia's meat ban on the West.
"Leg quarters in storage in August were up 7.5 million lbs from the prior month versus the five-year average that is normally down 5 million," Brown says.
He attributes leg quarter's nearly 13-million-pound swing in the average to lack of Russian buying, but adds that leg quarter stocks were still down 35 million pounds from last year.
Leg quarters initially destined to Russia would probably find more use domestically because of an unexpected decline in production here traced to breeding flock issues, he says.
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Broiler exports to Russia last year totaled 608.7 million pounds, compared with 588.4 million in 2012.
