Russia’s retaliatory sanctions have little effect on district exports
The direct economic effect of Russia’s retaliatory sanctions banning certain food and agricultural product imports from the United States is likely to be minimal for the Ninth District.
The list of products covered by these sanctions effective Aug. 7 includes all categories of (slaughtered) beef, pork, poultry and fish; most categories of milk and milk-based products, including cheeses and curds as well as a number of categories of fresh fruits, nuts and vegetables.
• Based on 2013 data, Russian sanctions would cover about $750 million of U.S. exports, representing 7 percent of U.S. exports to Russia and 0.05 percent of total U.S. exports.
• In the same year, Ninth District states exported $9 million worth of food and agricultural products to Russia now subject to sanctions, which account for 3 percent of district exports to Russia and 0.02 percent of total exports from the district (see chart).
• One of the reasons for the small impact is that sanctions notably do not cover sales of live animals, which accounted for 40 percent of the district’s agricultural exports to Russia last year. The list also excludes cereals and grains, as well as fruits, nuts and vegetables if prepared or preserved.
• Among Ninth District states, Wisconsin is most affected, particularly its concentrated or sweetened milk producers, exporters of frozen fruits and nuts, and kidney bean and white pea bean farmers, for whom the Russian market accounted for 17, 12 and 11 percent of total exports, respectively.
Exports also make up only a portion of total farm receipts, further dampening any potential impact. According to 2012 USDA data, for example, Wisconsin’s export revenues accounted for about 27 percent of total farm receipts and about 14 percent of total receipts from dairy products, its top agricultural commodity.