Russia bans food imports from Australia, US, EU over sanctions; Julie Bishop 'disappointed' by Russian retaliation

Updated

Foreign Minister Julie Bishop says it is disappointing Russia has retaliated over Australian sanctions imposed over the crisis in Ukraine and she has promised to assist affected Australian farmers.

Russia has announced a ban on most food imports from a range of Western nations, including Australia, in response to sanctions imposed on Moscow.

Meanwhile, NATO secretary-general Anders Fogh Rasmussen has called on Russia to "step back from the brink" of war by pulling its troops back from the Ukrainian border.

In a statement, Ms Bishop criticised Russia's move and said it should have done more to disarm the separatists in Ukraine.

"It is disappointing that Russia has acted in a retaliatory manner rather than respond to international concern by halting the supply of heavy weapons to the separatists, including the surface-to-air missile systems believed to have been used in the downing of Malaysia Airlines flight MH17 that resulted in the tragic deaths of 38 citizens and residents of Australia," she said.

Impact on Australia The bans could cost Australian producers hundreds of millions of dollars. According to Department of Foreign Affairs figures, exports to Russia in 2013 were worth: Beef: $150m

Butter: $64m

Live animals excluding seafood: $55m

Meats excluding beef: $48m The bans could cost Australian producers hundreds of millions of dollars. According to Department of Foreign Affairs figures, exports to Russia in 2013 were worth:

Russian prime minister Dmitry Medvedev says the country will ban fruit, vegetables, meat, fish, milk and dairy imports from Australia, the United States, the European Union (EU), Canada and Norway.

"There is nothing good in sanctions and it wasn't an easy decision to take, but we had to do it," Mr Medvedev said.

He says the ban is valid immediately and will last for one year.

The decision follows a decree signed by president Vladimir Putin ordering the government to ban or limit food imports from countries that imposed sanctions on Moscow for its support of rebels in eastern Ukraine and the annexation of Crimea.

Bishop offers support to affected farmers

Ms Bishop said Australia did not act alone. She said the EU, US, Canada, Japan, Switzerland, New Zealand and others also imposed targeted sanctions, travel bans or other measures.

"Australia has acted with others in the international community by imposing sanctions against Russia over its deplorable conduct in attempting to annexe Crimea and providing support to separatist forces seeking to destabilise Ukraine," she said.

Banned products Cattle meat

Pork

Poultry and related products

Salted, dried, smoked meats

Fish, shellfish, scallops

Milk and dairy products

Vegetables

Fruits

Nuts

Sausages

Cheese and related products

Ms Bishop says the Government will help Australian farmers affected by the sanctions.

"The Australian Government will do everything in its power to minimise the impact on Australian agricultural producers, including through new trade agreements and the opening up of alternative markets for their produce," she said.

The agriculture industry has reacted with concern.

A former president of the National Farmers Federation says Russia's halt on Australian food imports is a big blow for Australian agriculture.

Western Riverina farmer Duncan Fraser says it will affect beef, pork, fruit and vegetable products, as well as poultry, fish, cheese and dairy.

"Obviously the banning of food imports from the EU, United States, Canada, Australia and Norway, it's almost like they're punishing their consumers for a tit-for-tat retaliation," Mr Fraser told ABC Rural radio.

"I would think when things die down a little bit with Crimea, the support for the separatists in the Ukraine, I think it'll be lifted rather than extended anywhere else."

Also speaking with ABC Rural, Bega Cheese chairman Barry Irvin says Russian sanctions on agricultural products such as dairy will not have a direct impact – however the knock-on is a major concern.

Mr Irvin - one of Australia's major dairy processors - says Russia and China are the world’s two major importers of dairy products.

He says with Moscow shutting the door, it will mean the EU, which presently supplies much of Russia’s dairy imports, will now be looking elsewhere to unload its product.

"It will see a major shift in global supply and demand ... it is not good news for the Australian dairy industry," Mr Irvin said.

News of the sanctions have not come as a surprise to northern NSW meat processor and exporter John Seccombe.

Russia suspended chilled and frozen beef imports from Australia in early April this year, following a suspension on by-products like offal in January.

Mr Seccombe is chairman of the Northern Co-operative Meat Company in Casino, which was one of a list of Australian exporters affected by the temporary restrictions.

He says they are disappointed negotiations to reopen that market have now stalled.

Joyce working to open new markets for producers

Agriculture Minister Barnaby Joyce agrees there will be an impact on Australian farmers.

Australia exports more than $400 million in agricultural products to Russia each year.

According to Department of Foreign Affairs statistics, Australian beef exports to Russia were worth $150 million in 2013, while butter exports accounted for $64 million.

Sanctions 'largely symbolic' The ABC's Peter Ryan has spoken to University of New South Wales economist Tim Harcourt.



The former chief economist at Austrade says the sanctions are largely symbolic, but ordinary Russians could be hurt.



"They'd have to keep it on for a very, very long time and ultimately Russia would start hurting its own people before it hurt any Australian farmer," Mr Harcourt said.



Listen to Peter Ryan's report for AM and find extra audio of the Tim Harcourt interview here The ABC's Peter Ryan has spoken to University of New South Wales economist Tim Harcourt.The former chief economist at Austrade says the sanctions are largely symbolic, but ordinary Russians could be hurt."They'd have to keep it on for a very, very long time and ultimately Russia would start hurting its own people before it hurt any Australian farmer," Mr Harcourt said.

Live animals excluding seafood were worth $55 million and meats excluding beef were worth a further $48 million.

Overall, two-way trade between Australia and Russia in 2013 was worth about $1.79 billion in 2013.

"You can't really do anything about what Russia, as a sovereign nation, decides to do," Mr Joyce told Newsradio.

"We just try to work with these issues as they are presented to us, knowing I can't really affect Mr Putin and what Mr Putin decides to do. Most of the time I have a real struggle trying to affect my own colleagues."

Mr Joyce says he is working with other countries, such as Indonesia, to get them to buy more Australian beef and diary.

"Last night and yesterday I was talking to the Indonesians about their capacity for the purchase of more beef and dairy products. So we just try to work with these issues as they're presented to us," he said.

Australia is not offering direct assistance to farmers at this stage.

"Hopefully, if we manage this properly, we can find alternate markets to basically purchase the quota that the Russians don't," Mr Joyce said.

"I wouldn't be ruling anything in or anything out at this stage, but I would hope that we're able to manage it without direct assistance."

G20 ban for Putin unlikely

Australia appears unlikely to ban the Russian president from the G20 summit in Brisbane later this year.

Mr Joyce says Australia wants to continue talking to Russia.

"We've got to stay in negotiations with people as much as possible. Sometimes isolation is not the best form of negotiation because you have no forms of saying well, how do we resolve an issue? You can't resolve an issue with someone you're not talking to."

The Opposition's foreign affairs spokeswoman, Tanya Plibersek, agrees engagement with Russia is preferable.

"It is important for the world to say to Vladimir Putin, the behaviour in backing the separatists in Ukraine, the aggressive moves to other neighbours is unacceptable," she told Channel Nine.

"Sometimes the best way to do that is to say it to someone's face, but it is still not clear he will come in November."

Russia has also warned it could block international flights that cross its territory as they travel between Europe and Asia.

The use of Russian airspace saves Western airlines large amounts in fuel costs. Bank of America Merrill Lynch estimated that using longer routes could add about $32,000 to the cost of each flight.

It also noted that Russia's top airline, Aeroflot, which receives the fees gathered from European airlines for the over-flight rights, would be sent into a financial tailspin by the ban.

Mr Medvedev said closing the airspace was a "serious measure" being considered in response to the sanctions that have shut down Russia's first low-cost airline.

Aeroflot's low-cost subsidiary Dobrolet, which flew to Crimea, said it was forced to ground all its flights because of EU sanctions hitting its leases for Boeing aircraft.

ABC/Reuters

Topics: business-economics-and-finance, foreign-affairs, government-and-politics, russian-federation, australia, united-states, european-union

First posted