Tyson Foods confirmed Tuesday the company is ready to resume chicken exports to Russia following that country's universal ban of chlorine-treated poultry imports.
Russia's lucrative export market has been closed since early January and has cost the Springdale-based meat giant approximately $85 million in lost sales potential, based on prior-year sales.
Two local plants were deemed eligible for export once the U.S. Department of Agriculture updates its list, said Tyson spokesman Gary Mickelson. He would not disclose their locations.
Mickelson said Tyson submitted applications to the USDA for several plants to regain export eligibility after an agreement was reached late last month over an antimicrobial cleaning process used by U.S. companies.
"We've been told these facilities will be eligible to export to Russia once they are on the USDA's approved list and the list is submitted to the Russian Federation. It's our understanding USDA will transmit the first list this Friday," Mickelson said Tuesday.
The USDA said Russia has approved three pathogen reduction treatments for use in poultry processing. Cetylpyridinium chloride, a major agent used in mouthwash, hydrogen peroxide and peroxyacetic acid, an agent derived from vinegar that is used as a disinfectant in both medical industry as food and dairy processing.
Any of the three can be used to replace the chlorine wash companies have used for years, said poultry scientist Frank Jones, owner of Performance Poultry Processing in Springdale. He expects companies will choose the one that is most cost effective and easiest to implement into their plant operations.
Stephens Inc. analyst Farha Aslam noted Tuesday that U.S. companies can begin packing product for export to Russia this week.
She said leg quarters to Russia are expected to be priced between 40 cents and 55 cents per pound, well above the 30-cent average wholesale price paid by U.S. retailers in recent months.
"The reopening of the Russian border could not have come at a better time, in our opinion," said Ken Zaslow, food analyst with BMO Capital Markets.
He said the industry is still recovering from weak demand and ingredient costs are going up again.