A dispute over international food hygiene rules could result in the loss of $150 million in chicken exports a year for U.S. poultry companies, industry officials said yesterday.
At issue are European Union rules that forbid the use of chlorinated water to kill germs during the poultry-cleaning process - a practice employed by companies in the United States.
Those rules have shut U.S. chicken and turkey products out of the European Union market for four years, resulting in the loss of about $50 million in annual sales, according to William Roenigk, senior vice president of the National Chicken Council, a trade association based in Washington,
Now, the imminent entries into the EU of Poland, Hungary, the Czech Republic and Slovenia threaten U.S. sales to those nations because they would have to abide by the same European Union import standards. That could block annual sales of an additional $150 million in chicken and turkey products, Roenigk said.
"We have been shut out of the European Union market since 1997," he said.
"We've already lost $50 million in sales. We don't want to lose another $150 million," the trade association executive said.
Theresa Brophy, an international marketing specialist with the Maryland Department of Agriculture, said poultry products are the state's top agricultural export, accounting for about $59 million in sales last year.
Total Maryland farm exports in 2000 amounted to $260 million.
Paul Bissman, an international marketing manager for Perdue Farms Inc. in Salisbury, the state's largest poultry processor, said that his company exports to some of the countries that will be joining the European Union, but declined to give specific figures.
Roenigk said the threatened loss of exports, which represents about 7.5 percent of total annual U.S. poultry production, could affect processors' profit margins.
If the domestic market had to absorb that production, he said, it would lower the supermarket price of chicken and trim the processors' profit by 1 cent to 2 cents a pound.
"It would have an impact on Perdue in Maryland and every other U.S. processor, from the biggest company to the smallest company," Roenigk said.
The industry's profit margin was less than a penny a pound last year, according to Roenigk. He said the industry "is looking at 3 to 4 cents' profit [per pound] this year."
U.S. Agriculture Secretary Ann M. Veneman is scheduled to meet today with the European Union's farm commissioner to discuss trade issues.