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. Last Updated: 07/27/2016

Subsidy Fight Spills Into Russia

The dispute between the United States and Europe over farm subsidies has cropped up on Russian territory.

David Schoonover, the U. S. embassy's counselor on agriculture, told a gathering of Russian meat producers Wednesday that the United States was concerned about subsidized European imports to Russia and that it was prepared to match them.

But he said the United States is only doing so reluctantly, and prefers commercial ties to governmental charity.

"Russian firms, I'm sure, are not interested in a one-sided relationship", he said. "I, for one, am convinced that a commercial relationship, not aid, will strengthen this country".

He emphasized that the $900 million in American credit guarantees promised to Russia earlier this year -- $30 million of which were allotted to the U. S. pork industry -- was a purely commercial undertaking by private U. S. banks.

Schoonover assured the Russian meat producers in the audience, however, that it was not the U. S. government's purpose to undercut meat prices in Russia, but simply to protect the American pork industry.

"The United States government has no intention of establishing food aid programs that disrupt the commercial development of the Russian economy", he said.

Trade talks between the United States and Europe have been held up by the farm subsidies issue. France has said it would not be party to any deal.

Schoonver's comments came during a seminar sponsored by the U. S. Meat Export Federation, a trade association representing more than 150 American pork producers. The seminar, at the Radisson Slavyanskaya hotel, ends Friday.

Mike Skahill, the group's director of pork programs, said that participating American pork producers were trying to explain to their Russian counterparts how the U. S. industry functioned in the hope of establishing long-term trade relations and gaining access to the Russian market.

Skahill said that American pork producers were eager to take advantage of a U. S. government aid package which would subsidize sales of pork here.

Under the program, the American government would make up the difference between the market value of the meat in the West and the deflated prices in Russia.

The program will donate $20 million in pork sides and quarters to Russia and guarantee sales of $30 million worth of pork products.