By Aleksandras Budrys

MOSCOW (Reuters) - Russian chicken importers have begun seeking alternative suppliers, including Thailand, as talks with U.S. experts ground to a halt on Thursday without a commitment to reopen Washington's biggest export market.

Russia, which spent $800 million on U.S. poultry in 2008, has banned imports from its largest supplier on concerns related to the use of chlorine in treating the meat -- a practice routinely used in the United States to kill bacteria that can cause food poisoning.

Both sides said progress was made during two days of talks in Moscow and that negotiations would continue soon to resolve a meat dispute that has also led Russia to ban pork from all but six U.S. processing plants for excessive antibiotic residues.

But the lack of a deal weighed on hog futures in Chicago as traders anticipated increased chicken supplies in the U.S. market that would compete with pork.

It also pushed Russian importers to pursue alternative suppliers, the head of the country's powerful meat industry lobby said.

"Business is beginning to evaluate the new realities, and is preparing to work in the conditions of these new realities," said Sergei Yushin, head of Russia's National Meat Association.

"For Russia, this means switching to alternative suppliers. Importers are already working actively with some European and other countries," he told Reuters by telephone.

Russia suspended U.S. poultry imports from January 19 and has taken a hard line with Washington, accusing it of flouting food safety laws. The United States says its poultry is safe and some critics of the ban say it could be politically motivated.

Talks took place under tight secrecy in Moscow. Russia's only official comment was a statement by consumer protection watchdog Rospotrebnadzor, whose head, Gennady Onishchenko, was the lead Russian negotiator.

"The participants believe the talks allowed each party to clarify many aspects of their positions and to bring them closer to each other," the watchdog said. "The parties agreed to proceed with talks in the near future."

Visiting U.S. officials declined to be interviewed in Moscow. Agriculture Undersecretary Jim Miller issued a brief statement late on Wednesday that echoed Onishchenko's remarks.

U.S. Agriculture Secretary Tom Vilsack followed this up by saying more work would be required to resolve the issue. "We're working hard to try to find a common ground," he said.

No date has been set for the resumption of talks.

ALTERNATIVE SUPPLIES

Exports to Russia of pork, poultry and beef combined earned the United States more than $1.3 billion in 2008. Russia, as well as being the biggest U.S. export market for poultry, ranks among its top five pork markets and is the No. 10 beef buyer.

Russia's meat bans could affect U.S. companies like pork industry leader Smithfield Foods Inc, Tyson Foods Inc, Sanderson Farms and Pilgrims Pride.

The April lean hog futures contract posted a one-week low on Thursday, partly due to the news from Russia.

"It seemed like the market had its head in the sand on this issue until right now. They needed this confirmation that talks were indeed going to break down," said Dennis Smith, broker with Archer Financial in Chicago.

It's not uncommon for talks about trade spats to take some time to conclude, said David Bond, a trade lawyer with White and Case who represents companies and groups that produce and export meat.

"Obviously it would have been nice to conclude things very quickly, but we've seen ... with similar sorts of measures taken by other governments, that it's taken weeks and months to work these sorts of things out," Bond said.

There's no legal remedy for the issue because Russia is not a member of the World Trade Organization, Bond noted.

The European Union has a similar ban on U.S. poultry, which has sparked a WTO complaint from the United States.

As discussions continue, Russia will pursue supplies from Thailand and other countries, animal and plant health watchdog Rosselkhoznadzor said in a statement.

Rosselkhoznadzor head Sergei Dankvert had held talks with officials and businessmen from Thailand, the watchdog said, which offered to supply poultry to Russia either directly or through its plants in third-party countries like Turkey.

"The Thai side said it was interested in starting large-scale supplies of poultry imports to Russia and guaranteed full observation of Russian veterinary and sanitary rules," Rosselkhoznadzor said.

(Additional reporting by Christopher Doering and Roberta Rampton in Washington, Jerry Bieszk in Chicago, writing by Robin Paxton in Moscow, editing by Jim Marshall)