United States Department of Agriculture Poultry Export Guide: Agricultural Marketing Service Poland, Ukraine, Transportation and Marketing Estonia, Latvia Division September 1998 Poultry Export Guide: Poland, Ukraine, Estonia, Latvia September, 1998 This report was prepared by Debra Tropp, Agricultural For further information contact: Economist, Marketing and Transportation Analysis Program, Marketing and Transportation Analysis Program Agricultural Marketing Service (AMS), U.S. Department of Agricultural Marketing Service Agriculture (USDA) and Alexander Hristov, Research U.S. Department of Agriculture Fellow, Center for Agribusiness Policy Studies (CAPS), Room 1207, South Building Arizona State University. Funding for the study was provid- Washington, D.C. 20250 ed by the Transportation and Marketing Program Area, Telephone: (202) 690-1303 AMS/USDA, within the framework of a joint cooperative Facsimile: (202) 690-3616 agreement between AMS and CAPS. The views expressed herein are not necessarily those of the Agricultural Marketing Service or the U.S. Department of Agriculture. The U.S. Department of Agriculture (USDA) prohibits discrimination in all its programs and activities on the basis of race, color, national origin, gen- der, religion, age, disability, political beliefs, sexual orientation, and marital or family status. (Not all prohibited bases apply to all programs.) Persons with disabilities who require alternative means for communication of pro- gram information (Braille, large print, audiotape, etc.) should contact USDA’s TARGET Center at (202) 720-2600 (voice and TDD). To file a complaint of discrimination, write USDA, Director, Office of Civil Rights, Room 326-W, Whitten Building, 14th and Independence Avenue, SW, Washington, DC 20250-9410 or call (202) 720-5964 (voice or TDD). USDA is an equal opportunity provider and employer. i Acronyms and Abbreviations AMS Agricultural Marketing Service (USDA agency) c.i.f. cost, insurance, and freight CMR Contract for International Carriage of Goods by Roads ECU European Currency Unit EFFA Estonian Freight Forwarder Association ERS Economic Research Service (USDA agency) ESTMA Estonian Maritime Agency, Ltd. FAO Food and Agriculture Organization of the United Nations FAS Foreign Agricultural Service (USDA agency) f.a.s. free alongside ship FSIS Food Safety and Inspection Service (USDA agency) IMF International Monetary Fund LOA length overall MMT million metric tons MT metric ton NIS Newly Independent States PIERS Port Import Export Reporting Service PKP Polish State Railways RCP Riga (Latvia) Commercial Port SED Shipper’s Export Declaration TIR transports internationaux routiers (international road transportation) TM Transportation and Marketing Program Area TT Mutual Through Transport Club US$ U.S. dollars VAT value-added tax ii Poultry Export Guide Polish/Ukrainian/Baltic Region FINLAND Tallinn ESTONIA RUSSIA Riga LATVIA Baltic Sea LITHUANIA Gdynia BELARUS GERMANY POLAND Warsaw Lublin UKRAINE Lviv CZECH Kiev SLOVAKIA AUSTRIA HUNGARY Odessa Illyichevsk ROMANIA Black Sea BULGARIA iii Baltic Sea Ports NORWAY SWEDEN FINLAND Gulf of Bothnia St. Petersburg Tallinn ESTONIA North Sea LATVIA Riga DENMARK Baltic RUSSIA Sea LITHUANIA Gdynia NETHERLANDS Gdansk BELARUS Hamburg Rotterdam Bremerhaven POLAND GERMANY UKRAINE BELGIUM CZECH SLOVAKIA MOLDOVA SWITZERLAND AUSTRIA HUNGARY ROMANIA Black Sea BULGARIA TURKEY Mediterranean Sea iv Poultry Export Guide Ukrainian Black Sea Ports Dnepropetrovsk Zaporozhye Krivoy Rog Donetsk Botosani UKRAINE MOLDOVA RUSSIA Chisinau Nikolayev Frunze Odessa Kherson Illyichevsk Kransnodar Simferopol Sochi ROMANIA Constanta Black Bucharest Sea Varna Poti GEORGIA BULGARIA Burgas Zonguildak Istanbul Ankara Bursa TURKEY v vi Poultry Export Guide Foreword The “Poultry Export Guide” is intended for use by U.S. shipments by analyzing the comparative costs and time poultry producers, processors, and shippers alike. It includes requirements involved in the transport of poultry products information on transportation and distribution options that from the U.S. to Ukraine through a transshipment port on the can be used to deliver U.S. poultry cargo to Poland, an Baltic Sea, as opposed to direct shipments to a port on a important market outlet for U.S. poultry for both domestic Black Sea. As part of this analysis, the guide examines: consumption and reexport purposes, and Ukraine, where demand for U.S. poultry has surged during the past couple of • The most commonly used maritime routes and carriers for years. In addition, the guide includes information about the transshipments and for direct shipments; growing importance of Estonia and Latvia as transshipment • Costs and transit times of ocean freight and intermodal points for U.S. poultry headed for Ukraine and other Newly transportation links to final destinations; Independent States of the former Soviet Union (NIS). Please • Availability and costs of port services at various points of note, that the inclusion of any particular firm does not entry; connote an official endorsement by the U.S. Department • Costs and time requirements of inspection and customs of Agriculture. clearance; • Official documentation and quality requirements for The report has been divided up into six chapters, each of product importation; which addresses separate aspects of the process of exporting • Buyer product and packaging preferences; and frozen poultry to Poland, Ukraine, Estonia, and Latvia, • Channels of distribution and market segmentation. including: The idea for the study was sparked by comments made by • Structure of U.S. poultry trade in the region; two Polish delegates participating in a wholesale marketing • Import requirements and product preferences; training program sponsored by the Transportation and • Maritime and intermodal transportation options; Marketing Program Area (TM) of USDA’s Agricultural • Inspection and customs clearance procedures; Marketing Service in the fall of 1995. The two participants, • Wholesale and retail marketing channels for imported Jacek Austen, President of the Pomeranian Wholesale Agri- poultry products; and Food Center Company, Gdansk, and Dr. Wojciech • Freight transit times and costs from origin to final Ciechomski, Professor, International Institute of Agricultural destination through various ports of entry. Marketing and Management, Warsaw, suggested that it might be appropriate for USDA to investigate the growing role of By utilizing the comprehensive Table of Contents and List of Polish port facilities in serving as a gateway for perishable Tables in the front of the Poultry Export Guide, the reader food products to the republics of the former Soviet Union, can easily target information pertaining to his or her specific and that they would be willing to offer their services in area of interest. Moreover, each of the chapters is designed arranging relevant field interviews. At around the same time, to be read independently, permitting the reader to focus on a TM learned that the Center for Agribusiness Policy Studies specific export-related issue without having to read the entire at Arizona State University had a working relationship with document. However, for other prospective and current businesspeople in Ukraine involved in the distribution and exporters of U.S. poultry meat who may be unfamiliar with marketing of imported poultry, and would be able to offer the Polish/Ukrainian/Baltic region, the entire report can also its services in arranging field interviews with industry be read as a detailed, comprehensive outline of the various representatives in Ukraine to study distribution and steps involved in transporting and distributing frozen poultry marketing alternatives for U.S. poultry in the growing cargo from the U.S. to these destination markets. Ukrainian market. Through the combined contacts of TM and the Center for Agribusiness Policy Studies, the joint In recent months, transit time disadvantages, infrequent USDA/Arizona State research team conducted personal service, and the high costs of direct maritime transportation interviews with more than 60 individuals during the course from the U.S. East and Gulf Coasts to the Black Sea ports of of a 3-week trip to Poland and Ukraine in June 1996. They Ukraine, coupled with infrastructural constraints in the also obtained additional technical information about various capacity of Ukrainian (and Russian) ports to handle aspects of marketing and transporting U.S. poultry products refrigerated and containerized cargo, have prompted a in Poland and Ukraine from additional correspondence with groundswell of poultry transshipments through the Baltic many of these initial interview subjects and their referrals. Sea ports of Poland, Estonia, and Latvia to markets in the NIS. One of the primary objectives of undertaking this The research upon which the study was based would not study was to investigate the rationale behind the rise in trans- have been possible without the help of several individuals Foreword vii who went beyond the call of duty in arranging personal John Holmes, Managing Director, Baltic and Orient Freight interviews for the USDA/Arizona State research team and Forwarders, Odessa, Ukraine providing detailed information about industry practices in L. Robin Hudgins, Sales Coordinator, Maersk, Inc., Norfolk, subsequent correspondence. In alphabetical order, the VA individuals who deserve special recognition for their help Sergei Ignatenko, Managing Director, Estonian Maritime and cooperation in making this publication