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Russia's Food Ban Has Global Repercussions

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The consequences of Russia's ban on all food imports from the West is reaching food producers, restaurateurs, and farmers in all corners of the world. Earlier this month, Russian Prime Minister Dmitry Medvedev announced that "all imports of meat, fish, and fruit, vegetables, milk, and milk products" from the U.S., European Union, Canada, Norway, and Australia would no longer be allowed into the country for a full year. The move is in retaliation to "sanctions [from the West] over Ukraine." Medvedev and Russia's president, Vladmir Putin, have said that this ban "would give Russian farmers…a good chance to increase their market share."

According to Bloomberg, while some Russians "shrugged off the ban" or supported it, many restaurateurs and wealthier citizens believe they will suffer more from the import ban than the countries affected by the ban. One cafe owner told the Chicago Tribune that the ban feels like "Russian sanctions against Russians." Sushi, which is so popular across Russia that it even appears on the menus of some Italian and French restaurants, will take a substantial hit. Much of it is made with Norwegian salmon. One sushi restaurant manager notes "there is no Russian salmon" and worries he will lose his job.

A spokesperson for a major restaurant group in Russia tells Bloomberg that "this is an extremely difficult situation for the restaurant market as about 50 percent of ingredients are imported." Some hard-to-replace items like Grana Padano cheese from Italy and ham from Spain will most likely "disappear from menus" while items like steaks from the U.S. and Australia will be replaced with beef from Brazil and Argentina — which is pricier. Even chain restaurants are feeling a hit: The Russian franchise operator of Papa John's — which has 74 locations in the country — will probably "freeze expansion plans" due to the cost inflation from the import ban. The company is considering options like importing mozzarella from Argentina, but that is "15 percent more expensive." McDonald's — which was one of the first companies to be questioned by Russian authorities when the political climate between the U.S. and Russia froze over — has reported serious losses in worldwide sales. Mainly stemming from the Chinese meat scare, McDonald's sales in Russia are also being reported as "soft," according to Bloomberg.

It isn't only Russians and Russian restaurants that are hurting from this ban however. Russia imported $15.8 billion in food from the EU in 2013 alone, meaning imports from at the European mainland will take a hit this year. Bloomberg writes that many meat companies in Russia turn to the EU for beef because Russia's own domestic cattle industry isn't "very developed." Likewise, Australian meat suppliers are now on the hunt for markets to replace Russia's, reports ABC. The Chicago Tribune adds that Norwegian Salmon sales are expected to fall 10 percent this week and dairy farmers from the EU have had to slow down their cheese and butter production. The Associated Press notes that Russia has also placed bans on food from Eastern European countries like Moldova for "seeking deeper ties with the European Union." Moldova has had a particularly hard time with the ban as one of Europe's poorest countries that "depends heavily on its trade with Russia." So far, American food producers have not reported heavy losses, but the ban has only been in place for five days.

· Richest Russians Deprived of Luxury Foods [Bloomberg]
· Russian Restaurateurs Wrangle with Food Ban [Chicago Tribune]
· Australian Farmers Seek Alternative Markets [ABC]
· McDonald's Sales Sink 7 Percent [Bloomberg]
· Russian Food Ban Hurts Moldova [AP]
· Russia Bans Food From the US, EU, and Canada [-E-]
· All Russia Coverage on Eater [-E-]