Putin Retaliates, Orders Ban On All Food Imports From Sanctioning Countries For A Year

Putin chess

Russian Retaliation: Putin Orders Ban On All Food Imports From Sanctioning Countries For A Year (ZeroHedge, Aug 6, 2014):

Last week we noted Russia was considering banning fruit from Europe (as well as various other sanctions retaliations) but this morning Vladimir Putin has come out swinging by signing ‘a decree on countermeasures to Western sanctions’:

  • *PUTIN BANS FOOD IMPORTS FROM COUNTRIES SANCTIONING RUSSIA: IFX
  • *PUTIN ORDERS GOVT TO PREVENT ACCELERATED GROWTH OF FOOD PRICES

So trade wars escalate externally and price controls internally. It appears the US (and Europe) will indeed feel “tangible losses” despite Jack Lew’s promises.

Putin adds:

  • *PUTIN BANS, LIMITS FOOD IMPORTS FOR YR: IFX
  • *PUTIN CALLS FOR INCREASE IN DOMESTIC FOOD SUPPLIES
  • *PUTIN ORDERS GOVT TO MAKE LIST OF RESTRICTED AGR. PRODUCTS
  • *RUSSIAN GOVT WORKING ON LIST OF FOODS, PRODUCTS TO RESTRICT

As ITAR-TASS reports,

President Vladimir Putin on Wednesday signed a decree on countermeasures to Western sanctions.

The document entitled “On the Application of Certain Special Economic Measures to Ensure the Security of the Russian Federation” prohibits or restricts, for one year, the import of certain kinds of agricultural products, raw materials and food originating in a country that has imposed economic sanctions against Russian companies and (or) individuals or has joined such sanctions.

In addition, local analysts consider all the possibilities:

Russia’s response to Western sanctions may vary from country to country. In relations with the United States Russia may raise the question of banning US fast food outlets, which treat their customers to products harmful to health. The same applies to the marketing of PepsiCo products and genetically modified goods from the US,” the expert said.

“Some claim that tens of thousands of Russians may lose jobs in US fast food chains, while others argue that Russian businessmen are quite capable of opening a chain of domestic fast food joints selling natural fried potatoes, and not of Brazilian flour,” Delyagin said.

“In relations with the United States the most sensitive measures may be taken in the banking sphere. Also, there is a possibility of replacing Microsoft software being used at Russia’s government structures with alternative substitutes,” the analyst said.

“Also, Russia may stop letting NASA use its rockets as a means of delivering cargoes to the International Space Station, a service the United States is so much interested in. Or, if asked to go ahead with space cooperation, Moscow may address Washington with its own conditions,” Delyagin said.

“As far as Germany as Russia’s main economic partner in the European Union is concerned, the two countries have strong bonds in power engineering and the automobile industry. But Russia may as well import high precision machine tools from advanced countries in the Asia-Pacific Region, which will surely result in direct losses for German manufacturers,” the analyst said.

*  *  *

US officials are not happy…

“Assuming that they take this action, it would be blatant protectionism,” Clayton Yeutter, a U.S. Trade Representative under President Ronald Reagan, said in a phone interview. 

Putin Retaliates Against Sanctions With Ban on Imports (Bloomberg, Aug 6, 2014):

Russia will ban billions of dollars of food imports from the U.S. and other nations in retaliation for sanctions imposed over the turmoil in Ukraine.

Russian President Vladimir Putin yesterday ordered restrictions on food and agricultural imports for one year from countries that have imposed or supported sanctions against Russia, according to the Kremlin website.

Russia is embroiled in the worst standoff with the U.S. and its allies since the Cold War over Ukraine, where government troops are cracking down on pro-Russian separatist strongholds in the east. The U.S. and the European Union targeted the Russian economy, expanding penalties last week, joined by Canada, Japan, and Switzerland, after the downing of a Malaysian Airline System Bhd. passenger jet in Ukraine’s rebel-controlled area.

Putin has refused to bow to sanctions, aiming with food restrictions “to protect national interests,” according to the decree. He called on the government to boost domestic supplies with the help of producers and retailers and to avoid spurring food-price growth.

“Retaliating against Western companies or countries will deepen Russia’s international isolation, causing further damage to its own economy,” Laura Lucas, a spokeswoman for U.S. President Barack Obama’s national security council, said in an e-mail. “We continue to call on Russia to take immediate steps to deescalate the conflict and cease its efforts to destabilize Ukraine.”

Restricted Goods

The Russian government is drawing up a list of restricted goods. It plans to ban the import of all U.S. agricultural products, including poultry, as well as all fruit and vegetable imports from the European Union, according to a report in RIA Novosti citing Alexey Alekseenko, spokesman for Russian food safety watchdog Rosselkhoznadzor.

“The decision is not as critical as it looks at first glance,” Elena Tyurina, director of the Institute of Agrarian Marketing, said by phone in Moscow. “Many foodstuffs are imported from Latin America, Arab countries and Asia. We’ll be eating fewer apples and more bananas, oranges and kiwis.’

Russia imported $43.1 billion of food and raw agricultural materials last year. Of that, $36.9 billion came from countries outside of the former Soviet republics in the Commonwealth of Independent States, according to Federal Customs Service data.

EU Imports

EU members the Netherlands, Germany and Poland are among Russia’s 15 biggest food suppliers, as is the U.S., the U.S. Department of Agriculture said in a July 31 guide for exporters, citing data from the Global Trade Atlas.

About three-fifths of all U.S. farm exports to Russia this year have been soybeans, poultry and pork, according to USDA data. Even before the decree, Russia’s public health regulators banned some imports from EU member countries, the U.S. and Ukraine, in what those nations have called a veiled form of trade protectionism.

‘‘America’s farmers and ranchers would have been more surprised if they hadn’t announced a ban,” said Dale Moore, public policy director for the American Farm Bureau Federation, the biggest U.S. farmer group. “Russia does so regularly for seemingly small reasons, and now they have to deal with sanctions. This is a typical reaction by Russia.”

Bunge, Cargill

The U.S., the world’s biggest exporter of farm products, shipped $1.6 billion of food to Russia in 2013, or 4 percent of that country’s total imports, according to the USDA. Total farm-product exports from the U.S. will be a record $149.5 billion for the fiscal year that ends Sept. 30, the USDA said in May. The department projected sales to Russia of $1.3 billion, slightly more than the Dominican Republic in that period.

Bunge Ltd., the world’s biggest soybean processor, said in an e-mail that the White Plains, New-York-based company exports a small amount of soy meal to Russia and won’t be materially affected by the ban. Archer-Daniels-Midland Co., Cargill Inc. and Tyson Foods Inc., the top U.S. grain and meat companies, declined to comment.

While Russia is the second-biggest market for U.S. chicken, its share of export volume has fallen to 7 percent from 40 percent in the mid-1990s, according to a joint statement from the U.S.-based National Chicken Council and USDA Poultry & Egg Export Council.

“As a result, we do not expect that a Russian ban on U.S. poultry imports will have a great impact on our industry,” the groups said. “Free and fair trade –- particularly with food -– should never be used as a political bargaining chip.”

Arms Shipments

Russia’s list of banned goods will be published no later than today, said Natalya Timakova, spokeswoman for Prime Minister Dmitry Medvedev yesterday in a telephone interview, declining to elaborate. The list will be flexible, allowing for revisions in goods and timing, according to the decree.

The limitations will include vegetables, fruits, meat products, and exclude wine and baby food, the Russian newspaper Vedomosti reported, citing an unidentified government official. Some dairy products will also be restricted, the newspaper said, citing another unidentified official.

The ruble, which has weakened 9.1 percent against the dollar this year, is among the 10 worst-performing currencies, according to data compiled by Bloomberg. It depreciated 0.3 percent to 36.1775 against the greenback at 6 p.m. in Moscow.

Food Prices

Import restrictions have a “direct effect” on food prices, keeping them high despite a deceleration in the cost of fruits and vegetables, Maxim Oreshkin, head of the Finance Ministry’s strategic planning department, said Aug. 4 on its Facebook page.

Imported goods account for as much as 25 percent of retail sales in Russia, Andrey Karpov, executive director of the Retail Companies Association, said by phone. The country already provides about 90 percent of its own poultry, he said.

Inflation is the biggest challenge facing Russia, a poll published by the state-run VTsIOM research center July 10 showed. While consumer-price growth decelerated for the first time this year in July, the rate remained above the central bank’s target for the 23rd month. The central bank declined to comment on the decree.

“I can’t yet tell whether it’s a benefit or a threat,” said Dmitry Vostrikov, head of development at Russia’s food producers lobby, Rosprodsoyuz. “We’ll need to wait for a detailed list from the government.”

Tyurina said domestic producers will provide the nation with its basic food needs and Putin’s decision may act as stimulus.

12 thoughts on “Putin Retaliates, Orders Ban On All Food Imports From Sanctioning Countries For A Year

  1. Looks like he is returning to the Russia of my youth, locked and unknowable. The Russian people are the ones who will suffer, but they are used to it. If you look at Russian history, it is the bleakest on the planet.

    The war from the beginning has been economic, making up the difference with products from Brazil and New Zealand will still leave a lot of scarcity……..just like Russia was 50+ years ago.

    My brother was allowed to visit Russia 35+ years ago as part of a move to share medical knowledge. He said it was really strange. They had stores for the rich greedy guts crammed with wonderful things that only the rulers could buy. The stores they allowed the doctors to visit and shop in had nothing…..he told me I would have hated it, nothing to buy.

    All the citizens were highly educated, scientists were paid far less than a contractor who could build things, most went for a job with the government.

    Someone who could work with their hands was one who could command any wage. People would paint buildings, and paint over the windows…..nobody cared. It was all about getting a job with the government and assigned a better place to live.

    Assigned, that is how controlled and harsh Russian living was in those days. I hate to see him take them back to that because it won’t work, and the people have had a taste of western openness.

    I have been saying from the beginning that the war has been economic. Both New Zealand and Brazil have dumped the dollar. Brazil is part of the $100 billion in funds to aid other nations to break US financial domination. Now, those two countries have just gotten huge returns for siding with the east.

    He is breaking western domination economically, but it would be difficult, if not impossible, to return the people to pre 1980 living conditions. Many of the youth have had freedom they have never enjoyed before, and they are not going to happily give it all up.

    Russian history is full of sadness and misery. Putin has made all the right moves until now. If he tries to return Russia to the old Soviet Union, it won’t work well.

    Found this on the UK Guardian, looks like you already have the story.

    http://www.theguardian.com/world/2014/aug/07/russia-retaliates-western-sanctions-ban-food-imports

  2. One other thing, by banning German cars, he gives the business to Cherry Motors of China. China has been building carbon copies of all European and American cars for years.

    In order to enjoy slave labor, all the greedy corporations gave China the blue prints of all their products as payment. As usual, corporate thinking got us into a mess…..the east no longer needs the west, so lets have more wars?

    China has every product we have now. As companies continue their exodus from China to Vietnam and Taiwan, China has been left the garbage dump of the world…..but they can still build cars.

    So, the Russian elite will still have their German cars built by Chinese.

  3. Marilyn,
    Hardship in all forms is the foundation from which the bear is built.
    The Banksters are forcing them back into their cave, but why?
    You are the Historian. Please can you tell us WHY?
    Is it something to do with the Russian expulsion of the jews/zionists?
    The Russians lost 20M in the Wars but still persecuted the jews.
    Is it because they were too opportunist? Was it a race thing? Were they real jews or zionists? Another case where your experience is invaluable. we must know.

  4. The problem is, we have an enemy within.

    Our existence seems to be at the will of the few.

    But as we become aware, we become a challenge to their dominance.

    So they plan to eliminate, using us as a medium.

    But our ineptitude thwarts them.

    Until eventually they must expose themselves for us to resolve.

  5. To Friend Squodgy:
    Don’t be so sure the banksters can force the bear back into the cave. Putin’s nation is making money, unlike the EU or the US. Their debt level to GDP is at 34%, US is 99%, the UK is over 400%, most of the EU nations, including Germany are deeply in debt, far beyond what can logically be paid back.
    China’s debt is listed so low as to be laughable, economists estimate their debt level to be 5-12X what they really produce……they estimate their GDP on what they build, not what they earn.

    I think of all nations in BRICS, China is the weak link. However, they have all the blueprints of any key product ever developed in the west. So, with Putin holding their hand, and showing them how to do it, they can get some strength by building all the products that were originally developed in the west and providing them to Russia. Autos, power plants, appliances, computers, space technology……add in the Russian know how, and they can build a very powerful system in the east.

    Brazil, another member of BRICS has great technology in utilizing solar powered vehicles and homes, and can show the east how to dump western technology of the 19th century, such as oil as fuel. They have been quietly building to free themselves of all oil products since the Arab embargo of the 1970s. Brazil has leaders who serve the nation, not special interests.

    Next, you have India. They have some strong points to bring to the BRICS table as well.

    I don’t think the east is going to vanish, they are doing their best to make us vanish. Follow the money, and forget the noise.
    I see little hope for the west. As you put it, our existence seems to be at the will of the few and made reference to the Vandals Within. That is very true, we have some very evil people working in the shadows, people we never see. But, the ineptitude of the fools in power, the sock puppets, the bureaucrats….. hurts us greatly with their folly, and Putin is shooting fish in a barrel by comparison. The fools in power have destroyed us.

    The east is moving into ascension, while the west sinks like a stone. As for the bankers whose greed has caused much of it, many of them will sink too because they backed the wrong horses. I have no sympathy for any of them.

    Look at the debt level of the nations in the Eurozone. If you go to usdebtclock.org, you can click on world, and it will show you the debt levels of each country. Ignore China, it is such a lie as to be laughable, but the debt level of all of us in the west is beyond repayment…..there isn’t that much money in existence.

    Blame the hedge funds and all the other cheap games in the stock market, they continue to drain cents and dollars with their high frequency trades. It is better known as skimming, and used to be illegal. 85% of all transactions on the US stock market now consist of such trades. Only 15% are real investors, and who knows how many play on margin……

    The banksters have destroyed the western economy for many years to come. The reason there has been no recovery (but for the greedy guts) is that there is nothing left…..it is all gone. I don’t know about the UK, but here in the hell of the US, you cannot find an independent store, all are chains of greedy corporations.

    Since most employment is created by small business, and small business can no longer get funded to open here, there are no jobs of worth. Even greedy gut bankers are laying off staff.

    Like I said, I follow the money, and the growth and wealth is going east. Obama’s stupid sanctions have sent billions into Russia. All the wealthy Russians living abroad are sending their money back to Russia out of fear of their funds being confiscated. The same is true around the world, the US isn’t trusted at all, much as the world distrusted Russia when I was a girl.

    I find it very hard to believe Putin will take the east back into the cave…….they have been too long in the sunlight, and history can repeat patterns but not details. The greedy guts would love to see the east close all the doors and windows, but I don’t see that happening. It has been many decades since Soviet Russian days, and if Putin gets too repressive, he will lose power, and he doesn’t want that to happen.

    I am so glad I am not just starting out in this madness, it could be worse, I could be 20.

  6. 6pm PDT, Obama back on TV, sending goods and bombs into Iraq. I cannot f**king believe this. He can get no allies, so does stand alone air strikes and some food drops in Iraq……..was he not getting the US out of there?
    If anyone believed that…….too bad.

  7. Thankyou for that Marilyn.
    Over here we do still have independent businesses, including retail, but the US High St clone has absorbed most.
    I recall my dealings with Barclays. They had a dedicated ‘mergers & acquisitions’ sector back in the 60’s-80’s which accelerated the growth of what we now abhor, the Global Corporation. They would proactively encourage vertical and lateral integration.
    I believe the marriage of the banksters and CEO’s is part of the same disease.

  8. Would Russia ban import of only German cars? What will be the German economy losses? and if Russia will not ban import of other EU country cars, would others stop exporting? Would be the damage in billions or trillions of Euro? Who knows the answer?

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