RUSSIA READY TO AUDIT U.S. BEEF AND PORK

UNCLAS MOSCOW 002656

SENSITIVE
SIPDIS

USDA FAS FOR OCRA/FLEMINGS, KUYPERS;
- OSTA/HAMILTON, BEAN
PASS FSIS/HARRIES, DUTROW
PASS APHIS MITCHELL
STATE FOR EUR/RUS, EB/ATP/SINGER
STATE PASS USTR FOR PORTER
BRUSSELS PASS APHIS/FERNANDEZ
VIENNA PASS APHIS/TANAKA

E.O. 12958: N/A
TAGS: EAGR ETRD TBIO WTO RS
SUBJECT: RUSSIA READY TO AUDIT U.S. BEEF AND PORK
FACILITIES

REF: A) HANSEN/DUTROW EMAIL, B) MOSCOW 2620

SENSITIVE BUT UNCLASSIFIED


1. (SBU) SUMMARY: The Russian Federal Veterinary
and Phytosanitary Surveillance Service (VPSS)
informed via official letter that it is ready to
participate in joint inspections of 31 U.S. pork
facilities beginning September 29. In addition,
VPSS stated its readiness to send a team of
inspectors to jointly inspect 30 U.S. beef
facilities in October 2008. VPSS requested a
visit to several cattle and swine farms during
the audits. Original scanned copy and courtesy
translation were sent to USDA's Food Safety and
Inspection Service (FSIS) on September 4 (REF A).
An informal embassy translation of the letter
follows. END SUMMARY.


2. (SBU) BEGIN TEXT:
Moscow, September 3, 2008
No. FS-NV-2/8889

Assistant Administrator
FSIS Office of International Affairs, USDA
Dr. William James

The Federal Veterinary and Phytosanitary
Surveillance Service (VPSS) thanks you for your
efforts in preparing a visit of Russian
specialists to the United States for joint
inspections of a sample of pork and beef
establishments, which complies with the Agreement
of November 19, 2006, on inspection and
certification of U.S. establishments. In
response to your letter dated August 8 and August
11, 2008, I would like to inform you of the
following:

We agree with your proposal to start joint
inspections of U.S. pork facilities on September
29, 2008 and to organize three groups of
inspectors.

However, our proposals regarding the conditions
of U.S. pork facilities audit in September and
U.S. beef facilities in October 2008 described in
our letter No. FS-GK-2/7899 of August 8, 2008 are
still in force.

In this connection, we ask FSIS to send us via
the American Embassy in Moscow an official
invitation for specialists listed in our previous
correspondence (letter No. FS-GK-2/7899 of August
8, 2008),and also please send us the itinerary
for the joint inspections. A list of Russian
delegates with group allocations will be sent you
shortly.

In order to increase the effectiveness and
likelihood of getting reliable results, each
inspection group should include three Russian
specialists who will audit no more then one
establishment per day without any relation to
which firm the establishment belongs to.
Attached please find an amended list of the
Russian delegation with group allocation.

Please include in the joint audit program 2-3
farms suppliers of animals for slaughter at the
beginning of the inspections.

For your convenience please find attached
passport data of Russian specialists and list of
U.S. beef and pork establishments subjected to
the inspection.

Dr. James, please accept my assurances of the
deepest respect.


Attachment: 7 pages (not included in this cable)

Deputy Head
N.A. Vlasov
END TEXT.


3. (SBU) On August 29, VPSS officially informed
Post that it had delisted 19 U.S. poultry
facilities, all of which were among the 39
facilities audited by Russian inspectors in July
and August (REF B). VPSS stated that its
inspectors found "large numbers of deficiencies"
during the audit leading them to temporarily
banned poultry exports from those facilities as
of September 1. VPSS also issued a cautionary
statement on 29 other U.S. poultry plants saying
that product originating from those plants tested
positive for arsenic, E. coli, Salmonella, and
antibiotics. News first broke August 28 in a CNN
interview with Russian PM Vladimir Putin during
which he announced the outcome of the poultry
audit and stated that the results had nothing to
do with recent tensions between the United States
and Russia over the Georgia conflict.


4. (SBU) Over the past two weeks, senior Russian
Government officials have emphasized the need to
protect the domestic agricultural sector from
imports. Agriculture Minister Gordeyev announced
August 27 that his ministry would focus on
protecting Russia's poultry, pork and dairy
sectors. Those sectors have been unprofitable
because of poor management, the use of old
technology, and rising input prices. Agriculture
Minister Gordeyev stated that "the time has come
to change the quota regime and reduce imports,
which have unfortunately been on the rise
recently" and hurt Russia's interests. He said
that Russia had "been cheated, to put it mildly,"
and noted that quotas for pork and poultry
imports could be cut by "hundreds of thousands of
tons."


5. (SBU) On August 26, First Deputy PM Viktor
Zubkov said the government planned to spend an
additional 102 billion rubles ($4.1 billion) on
domestic agriculture subidies over 5 years.
Zubkov's announcement came after PM Putin and
First Deputy PM Shuvalov stated August 25 that
Russia should suspend or renegotiate some of the
commitments made during WTO accession talks in an
effort to support domestic farmers.

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COMMENT
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6. (SBU) Given the recent statements from senior
GOR officials calling for restrictions on
agriculture imports, Post recommends that FSIS
coordinate with FAS and APHIS to include a visit
to cattle and swine farms, as requested in the
VPSS letter. VPSS stated that its inability to
visit U.S. poultry farms was one of the primary
reasons for suspending imports from 19 plants,
even though the U.S.-Russia poultry agreement
does not contain a provision for on-farm visits
during routine yearly audits by VPSS inspectors.
Given the current protectionist rhetoric from
senior GOR officials, it is certainly possible
that the desire to protect domestic agriculture
interests will be more important to VPSS
inspectors than what they actually see on the
ground. Nonetheless, post believes that the
chances for more favorable audit results will go
up if an effort is made to satisfy VPSS's request
to visit a few cattle and swine farms prior to
the audit.

BEYRLE