USDA report on Russia

Executive Summary
On July 20, the Federal Service for Veterinary and Phytosanitary Surveillance of the Russian
Federation (VPSS) lifted the ban on Indian rice imports, although all imports must be
certified by Shriramsky Research Institute, the only Indian laboratory approved by VPSS.
Following the suspension of all rice imports in December 20061, renewal of imports from the
major traditional suppliers has depended on the VPSS’ country-by-country inspections of rice
production and handling chains. Imports remain banned from all countries that have not
consented to VPSS’ request to inspect their domestic rice production, transportation, storage,
and handling, including lists of chemicals, norms of application and practices of certification
of these chemicals by the government agencies. In January – May 2007, Russia imported
67,000 metric tons of rice, compared with 172,000 metric tons during the same period last
year. Along with the reduced rice import volumes, the number of suppliers decreased
significantly, with those granted market access depending entirely on VPSS’ inspections and
goodwill, as is demonstrated by the charts on page five of this report. Experts estimate that
the average price of rice in the domestic market increased by 30 percent compared with
prices in 2006. Furthermore, some types of rice, especially premium quality varieties,
disappeared from the market completely. Total 2007 rice imports are forecast to fall 50
percent from the previous year to 180,000 metric tons2.
Rice imports from the United States have been banned since September 2006.
Chronology of VPSS’ Activities Related to Rice Imports
In January – May 2006 rice was exported to Russia from twenty countries, with China, India,
Vietnam, Pakistan and Thailand as the main suppliers. In January – May 2007, fewer than
ten countries exported rice to Russia, with Thailand, Kazakhstan, India and Pakistan
accounting for more than 98 percent of the trade. Imports of rice from Vietnam and China
have almost ceased. The chronology of VPSS’ relations with the remaining supplying
countries, and monthly fluctuations in rice imports are discussed below.
China
According to the Russian press, Chinese authorities expressed willingness to invite VPSS
specialists to China in order to become acquainted with their phytosanitary service, but the
Chinese side required more precise information on the matter. Chinese rice exports to Russia
ceased in December 2006, and have not yet resumed. Chinese rice exports to other markets
have increased.
Vietnam
Vietnam has reportedly not responded to VPSS’ request for inspections, and their rice
exports to Russia have stopped completely. However, Vietnam is reportedly not in a hurry to
renew exports to Russia, due to tight supplies and export commitments to its Asian
customers.
Pakistan
In March 2007, VPSS detained a rice shipment from Pakistan ostensibly due to Khapra beetle
infestation, and VPSS banned imports of all plant products from Pakistan. Russian
authorities reported their intent to visit Pakistan for inspections. However, Pakistan’s
government reportedly cannot pay for the travel, and inspections have not yet taken place.
Rice trade with Pakistan was officially discontinued.
Thailand
Thailand was the first country for VPSS’s rice chain inspection.
In late November 2006, VPSS announced that Russia might ban rice imports from Thailand
because when it detected that pesticides exceeded 2.3 times the maximum allowable limit in
a 375 metric ton shipment to Omsk oblast.
On December 24, 2006, Sergey Dankvert, Head of VPSS, informed the Russian press that a
team of Russian inspectors had flown to Thailand for a week to study rice production and
methods of laboratory testing of rice. On January 10, 2007, Dankvert informed the press
that henceforth every lot of rice shipped from Thailand would be accompanied by certified
test results from one Thai government laboratory that had been accredited by VPSS.
Dankvert added that rice would be accepted from processing facilities that have been
inspected and approved by Russian inspectors.
India
On February 23, 2007, VPSS concluded inspection of India’s rice production and handling
chain, and demanded that India arrange for documentation to accompany each lot of rice,
showing whic h pesticides, in what doses, and what dates were used during the growing
season. VPSS allowed Indian rice imports into Russia with certificates from one authorized
laboratory (Sriramsky Research Institute), but warned that if this condition was not met, rice
imports might be halted May 1. In order to continue rice exports to Russia, VPSS required
that India must, “organize… their work regarding rice exports to Russia in such a way that
every shipment is accompanied by documented information about use of pesticides in the
growing and storing of rice, with doses applied and the date of the latest application.”
On April 29, 2007, VPSS imposed temporary restrictions on rice imports from India beginning
May 1, 2007, because India did not provide the required information on pesticide use and
government control of rice production.
In June 2007, VPSS banned import of rice, peanuts, and sesame seeds from India. All
licenses and permits previously issued were cancelled. Data on rice imports in June are not
yet available, but according to sources, these volumes were very small.
On July 25, VPSS published on its website that on July 10, 2007, VPSS and Indian
government authorities signed Minutes on their meeting relating to creation of a system of
safety control and guarantees for rice shipped from India to Russia. Based on these Minutes,
VPSS lifted the ban on imports of Indian rice. According to VPSS’ press-release, “rice,
shipped from India after July 20, 2007, is imported to the territory of the Russian Federation
based on the results of control-surveying measures on availability of valid import quarantine
permits, certificates, confirming safety of rice and quality, issued by Indian Shriramsky
Research Institute, and phytosanitary certificates.” According to the press, approbation of
other Indian laboratories for issuance of safety certificates for rice can be expected after
another VPSS examination trip to India.