Are we scared by Bush drumsticks?
Halyna Stanislavivna, a resident of Kyiv, told The Day she had never bought chickens cheap, that she knows from her experience: food selling cheap may be bad for your health. Drumsticks she did not trust. God knows where this deep-frozen meat comes from! “We’ve heard about the kind of chemicals they use over there. You want to eat well, you buy natural products.”
A veteran hausfrau, she seems to have made her choice, regularly buying foods sold from trailers belonging to a reputed Ukrainian company, stressing she is sure that her family will be served quality meals: the products are always fresh. It is also true, however, that another female customer (obviously in her pension age, buying food from the same trailer and identifying herself as Granny Maria) said she had to buy it cheap because she had no choice.
Apparently, the domestic chicken market is dominated by the price- quality ratio. The Association of Ukrainian Poultry Breeders, formed Friday (including over 200 enterprises in the field), proclaimed domestic consumer protection as one of their highest priorities. Yuri Kosiuk, chairman of the board, Myronivka Khliboprodukt private limited partnership, said the new organization wanted to achieve equal terms for all market operators in the original phase. Sounds quite topical, considering that Ukraine recently lifted US poultry import restrictions, and that the effect on the domestic market and its prices remains to be seen.
Contraband supplies (estimated by some sources as making up one-third of the domestic market) remain the biggest threat; Ukrainian poultry breeders are mostly alarmed by the renewal of US chicken supplies (banned in January 2002, when it transpired that the Americans were using antibiotics and growth stimulants, as well as disinfectants and preservatives when treating carcasses). Now they will again be allowed to supply Bush drumsticks, but only in the presence of veterinary certificates attesting the absence of antibiotics and preservatives. A Ukrainian-US agreement was signed to this effect.
Volodymyr Semen, director general, Ukrptakhoprom research-and- production association, believes US chicken expansion may have a negative effect on domestic poultry factories, because US products will prove considerably less expensive. He suggests US chicken imports may register 100,000 tons this year, after lifting the restrictions. Mr. Kosiuk believes that an import duty should be instituted to make domestic products competitive (at least 45-50 cents a kilo of drumsticks, compared to the current rate of Euro 1.5 a kilo). This would level off the high degree of “state support” [i.e., federal budget subsidies] enjoyed by the farming exporters in the United States. Strangely, domestic poultry breeders do not seem to bother to provide any information concerning the profitability of their businesses — or relating to factors holding back lowering selling prices. Granted: their overseas rivals have that state support; then it is also true that domestic producers are allowed low fodder wheat prices and miserable payroll.
Maryna Segal, chairperson of the board, Complex Agromars private limited company, is not disturbed by US chicken imports; she says that Ukraine is “prepared to meet the challenge,” adding that Ukraine supplies ecological safe, fresh products that has long been appreciated by consumers. “Our producers use no growth stimulants, hormones, synthetic additives, feed including animal waste. At present, the nominal value and selling price of chicken meat in the United States and Ukraine are practically the same (according to the statistics of the Ministry of Agrarian Policy, the release price of chicken meat supplied by Ukrainian factories is UAH 6.5-6.9). The only difference is that the Americans use mostly chicken breast; it costs and it fully provides for the manufacturing process. At the same time, they supply us drumsticks which is considered a byproduct in America, hence its low selling cost.
Resuming US chicken imports to Ukraine should be viewed as a positive factor in view of frictions in the current Ukrainian-US dialog relating to WTO matters. Ukraine’s expected WTO membership opens up new horizons for domestic poultry breeders (e.g., market expansion), but it also brings forth new problem: protection of domestic interests. Now it is the buyer’s choice between the Kuchma and Bush drumsticks, paying for it with his hard-earned hryvnias, meaning that he will make the right choice.
