- Russia imposed sanctions that ban produce, beef, pork, poultry, fish, and dairy imports from the United States, EU, Australia, Canada, and Norway. The sanction is in response to Western sanctions against Russia last week.
- The ban, set to run for one year, could cause considerable damage to food and agricultural companies across the globe. Russia imported nearly $37 billion in food goods last year from outside the former Soviet Union.
- American poultry producers will likely be hit hard by the ban. Russia accounts for 8% of U.S. poultry exports. Other possible losers are ag processors such as ADM and Cargill, which ship commodity crops around the globe. Rival processor Bunge told Bloomberg News that it exports little to Russia and will not be materially harmed by the ban.
Russia's move wasn't unexpected. As America and its allies have issued sanctions in response to Russia's invasion of Ukraine and the downing of a passenger jet by alleged Russia-backed rebels, retaliatory sanctions became inevitable.
Sophisticated players in global trade have no doubt bought hedges and otherwise prepared for this day. There seems no reason to worry excessively about Russia's move.
There may, however, be good reason to worry about Russia's next move. NATO issued a harsh warning to the world yesterday that Russia has deployed some 20,000 troops on the Ukraine border, and that a deeper incursion into that nation was possible.