Russian dairy import ban: A matter of displacement

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The U.S. dairy industry won't see much direct impact from Russia's recent ban on agricultural products. According to the International Dairy Foods Association (IDFA), U.S. dairy exports have been shut out of the Russian market since September 2010, due to failed attempts by the two countries to reach an agreement on a dairy certificate and a list of approved facilities.

However, displacement effects may well be significant, according to the National Milk Producers Federation (NMPF). The ban also affects the European Union (EU), Australia, Canada and Norway, which means dairy products from those countries that night have been imported by Russia will need to find a home elsewhere in the global market, adding to supply and price pressures.

Measured by trade values, Russia accounted for about 7.5% of total world dairy imports in 2013, excluding intra-EU trade, and about 70% of Russia’s dairy imports came from the now-banned countries, almost all from the EU, According to NMPF’s August 2014 Dairy Market Report.

The ban is set to run for at least one year and is in response to the economic sanctions placed on Russia by these countries.



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