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. Last Updated: 07/27/2016

Chicken Prices Leap 30 Percent

Fueled by a looming ban on U.S. imports, wholesale prices for poultry have shot up 30 percent over the past five days, the U.S.A. Poultry and Egg Export Council, or or USAPEEC, said Monday.

The government on Friday suspended issuing import licenses for U.S. fowl, which accounted for 70 percent of all domestic poultry sales last year, and said it would introduce a temporary ban on the imports from March 10. It said U.S. authorities had failed to provide sufficient information about the antibiotics, preservatives and other substances used in the poultry industry and accused U.S. exporters of violating Russian veterinary rules.

Observers say Russia may be looking to gain leverage ahead of a U.S. decision on slapping sanctions on Russian steel, expected this week.

"Domestic wholesale prices on poultry sharply rose to $1.20 per kilogram as of Monday from $0.92 per kilogram in less than a week," said Albert Davleyev, head of USAPEEC's Russia office.

Davleyev warned prices in Moscow could soon reach $1.50 per kilogram.

It was not immediately clear how prices were faring elsewhere.

"I am deathly afraid of what will happen when American markets open," Davleyev said. U.S. poultry prices, the benchmark for world poultry prices, were likely to drop.

USAPEEC president Jim Sumner protested the ban Monday, saying U.S. poultry exporters had been following Russian rules to the letter. "If Russia has changed its veterinary rules, then the American side was not informed in time," Sumner said, Interfax reported.

The United States said Friday it would send a delegation to Russia this week to push for the imports, which amounted to more than 1 million tons in 2001.

However, the Agriculture Ministry said there was nothing to discuss. "There is nothing at all that we can talk about until March 10," an Agriculture Ministry source told Interfax on Monday.

In the meantime, seven ships arrived at a St. Petersburg port Sunday and Monday, each carrying 5,000 tons to 8,000 tons of frozen poultry. "It is absolutely unclear now what is going to happen to those ships," Davleyev said.

"We are hostages of this situation," said Alexander Volkov, general director of the Bely Fregat poultry importer.