Some U.S. poultry producers, including Pilgrim's Pride and Tyson Foods, were still trading in positive territory after the announcement.
The threat of a Russian ban on U.S. poultry imports had agriculture companies alert to the risks of a conflict that's already roiled trading of crops ranging from soy, beef and fruit to California pistachios. American Farm Bureau Federation President Bob Stallman called the decision a "political move," adding that it hurt Russia's people.
"It is unfortunate that the biggest losers in this will be Russian consumers, who will pay more for their food now as well as in the long run," Stallman said.
Moscow had previously struck back against sanctions by imposing food restrictions, and would add U.S. chickens to Ukrainian soy and other products Russia has blocked since it seized Crimea: Australian beef, Latvian and Lithuanian pork, Moldovan fruit and Ukrainian juice.
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Sanderson Farms, the third-largest poultry producer in the U.S., was among American agricultural companies preparing to respond if Russia carried out plans to restrict imports of U.S. poultry.
Russia was "using foreign trade as a political football" by threatening to limit poultry imports, Sanderson's Chief Financial Officer Mike Cockrell said. The Mississippi-based company was lining up other buyers for its chicken in case Moscow imposed a ban.
"We'd be crazy not to be making calls to alternative markets right now," he said.
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Russia's move to limit agricultural trade is seen as a sign the conflict with Washington is heating up. Russia imported about $1.3 billion in U.S. food and agricultural products last year, or about 11 percent of all U.S. exports to the country, according to U.S. Census data.
—By Reuters and The Associated Press. CNBC.com contributed to this report.