How much protection does the poultry industry need before it can stand on its own two feet?
Francois Baird, a spokesperson for local poultry, regularly writes some eloquent, fiery pieces comprising a mixture of well-researched facts, obvious omissions, red herrings thrown in for good measure, and a dose of total misinformation (“Chicken importers need to read the literature on dumping,” March 30).
First, this is the sixth protective tariff increase applied for by local poultry in 10 years. How much protection does the poultry industry need before it can stand on its own two feet?
Of course, all theses extra duties increase consumer prices. That’s Economics 101. As regards importers needing to read the literature on dumping, I am not an importer and I have read it.
In all honesty, I cannot deny that some dumping may be taking place. Baird is correct that most other chicken-producing countries have little domestic demand for brown meat. But then I have also read the various financial reports and statements issued by the major local poultry producers. They clearly cite rising feed costs and the poor local economy as the primary causes of their woes.
A recent published quote from the largest local poultry company: “Feed costs remain the key driver of profitability.” Material damage to our very efficient poultry industry has clearly been caused by factors other than imported chicken. Baird loves to place SA in the same boat as Ghana, as he regularly predicts the destruction of the local chicken industry by surging imports.
This is scaremongering. Poultry imports, weighed down by huge tariffs, have had a staggering volume reduction over the past few years and now represent no more than 15% of local consumption. I am happy to substantiate this figure using Sars statistics, excluding mechanically deboned meat, which is not manufactured in SA and does not represent a competitive threat to anybody (chicken soup is no different).
Comparing our situation of a dominant and capable local poultry industry with Ghana is pure fantasy. Baird then wears his prophet’s hat and tells us imports from the alleged dumping countries are set to soar again. Perhaps he would care to explain how this is possible when the majority of the alleged dumping countries are banned from exporting chicken to SA due to avian influenza, and such bans have been reliably predicted as being in place for a long period, in line with SA’s own veterinary policies.
Local poultry has not even bothered to include the US in its application. SA imports a large annual quota of bone-in chicken from the US, subject to dumping duty rebates in terms of an extension of the African Growth and Opportunity Act (Agoa) agreement. The implication of this is that certain countries are accused of causing injury to local poultry while the US is protected. Are we seeking protection from alleged predators selectively? Surely that runs counter to anti-dumping law and practice?
Once again, all sorts of excuses are produced for SA’s lack of success in securing chicken exports to the EU. For years SA did not even apply for such exports, a fact publicly conceded. Now there are difficulties because we are unable to comply with the EU’s standard veterinary health certification requirements. A call to our local efficient and capable state vets will confirm this.
SA has an efficient poultry industry holding 85% market share. It has ably battled some difficult headwinds over the past few years. It should grow and prosper by continuing to do what it does well — producing quality, protein-rich foods. It has no need to constantly attempt to close down the import industry, which does not pose the threats alluded to by Baird.
These ongoing battles are expensive and very poor PR exercises, while financially hurting hard-pressed consumers in a torrid