Meat to be retained at the border.

Over the past month Ukrainian meat processing facilities, due to the absence of import materials had to increase procurement prices for animals. For the domestic meat industry this has been a unique situation when the prices for the market are set by the producer, increasing the cost of live weight pork and beef almost on the weekly basis. When, at the end of July, Ukrainian farmers observed the price rise for cattle and pigs, they interpreted it as the consequence of rapid crops price rise, and also further reduction of the total number of animals. In the spring farmers had to butcher a large number of animals because of low procurement prices of meat processing enterprises, which due to serious volumes of the imported materials in 2009 were able to use only cheap import materials. However, despite the statement of the market operators on the critical reduction of the total number, according to the official data, it, in fact, grew. For example, as of 1 July this year, according to the data of the State Committee on Statistics, cattle total number was 5,527 million items which was 3% less than the index of the similar period of 2009 (5,698 million items), whereas the total number of pigs grew by 12,7% (!) — from 7,432 to 8,374 million items, the total number of poultry was 235,151 million items, which was 4% more than the respective total number of the similar period last year (226,543 million items). This promising statistics, nevertheless, did not impress officials from the Ministry of Agricultural policy, who actually simultaneously with the publication of these statistical data made a conclusion that the statements in the media on the necessity to restrict meat import. Ministerial officials said that they were preparing a document, suggesting quoting of the import, were writing a respective letter to the World Trade Organization and generally they were planning to start reviewing the conditions of Ukrainian membership in the WTO, particularly, the increase of the customs duties for the meat import. It is notable that nothing of the abovementioned was not done by the officials, but the volumes of meat import have been falling down lately. For instance, the import of highly-demanded by the processors pork over the first seven months this year, according to the data of the State Enterprise «Derzhzovnishinform», was about 55,38 thousand tons, while over the similar period last year around 140 thousand tons were imported. A source at the Ministry of Agricultural Policy informed "і" that planned actions to limit the import were not adopted and will not be adopted in the near future, since «it was not supported either by the President’s Administration, or by the Cabinet of Ministers, which treated this idea skeptically». Another source of the authority, involved in the control of the import of foods noted that the Cabinet of Ministers ordered all the controlling bodies to encourage limitation of the meat import, by any means. For example, currently the specialists of the committee of veterinary medicine carry out an «extended inspection» for each batch of imported meat, which leads to the fact that most cargos are returned to the suppliers. It is worth noting that this strategy of struggling against the importers was borrowed by the Ukrainian authorities from their Russian colleagues, who, by the way, do not have membership in WTO yet. For instance, a week earlier there was a scandal, related to the supplies of Brazilian meat to Russia. 8 September Russia suspended the supplies of beef and chicken from Brazil due to the fact that in some of the batches experts found bacteria of listeria and salmonella. As a result the shares of the Brazilian giant JBS lost 2,28%, shares Marfrig — 0,23%. Brazilians, in their turn, have already declared that Russia took protectionist actions in favour of its producers. In May this year Russia banned the supplies of meat from eight Brazilian butcheries. But in the end sanitary, which had served the grounds for the ban, were never found. We should therefore remind that Russia for Brazil is the essential meat market, so any restrictions have serious consequences for the industry of the largest player on the world market. In one of the latest issues of the specialized periodical of Brazil, Brazilian Meat Monitor, it ran about the possibility of renewing the supplies of meat to Russia through Ukraine, but, as we can see, these aspirations of the Brazilians were not to come true. Another reason for closing the import, perhaps, may be business ambitions in the meat industry of some high officials. For example, last year there opened a large swine breeding complex CJSC «Agro Invest» with the full production cycle (from the production of fodder to retail outlets), controlled by vice-premier for preparation to Euro-2012 Boris Kolesnikov.