The South African Poultry Association (SAPA) is concerned about irresponsible claims by a South African consumer protection body and a new organisation called Emerging Black Importers and Exporters of SA – fronting the Association of Meat Importers and Exporters (AMIE) – in support of predatory trade from Brazil.

This may cost tens of thousands of South African workers in the chicken and related industries their jobs.

SAPA represents hundreds of chicken farmers both big and small, and have regular direct contact with hundreds more. As such, we have seen first-hand the devastation that uncontrolled dumping over the past few years has wrought on especially emerging black farmers. SAPA says it has in the last six months watched with distress as almost half of the small farmers SAPA had regular contact with, have gone out of business, due to the simple fact that their potential markets have been flooded by ever-increasing volumes of dumped imported chicken.

The hundreds of workers these farmers employed have now joined the ranks of the unemployed. Imports, of which 61% come from Brazil, currently outnumber the output of even the biggest South African producer, says SAPA.

“The import tariffs that are in place have not slowed this down in the slightest… in fact, Brazil increased its exports to take up the slack that was caused when avian flu in the EU closed those borders temporarily. This is why SAPA has applied to ITAC to increase the tariff payable by Brazil to 82%, which is the maximum allowed by the WTO. The WTO allows tariffs up to these levels precisely to level out the playing field between trading partners that have unequal production environments, due to, for example, subsidies. In so doing, tariffs prevent one territory from unfairly dominating and eventually destroying the market in the countries it exports to, to gain market control. Examples elsewhere in Africa, such as Ghana and Cameroon, show that dumping destroys local industries,” says SAPA.

“It leaves local populations dependent on imports, and at the mercy of importers and export countries who decide the price. And yet Ebiesa and SANCU argue that this scenario would be better for food security than having a robust local industry that produce food for its own people as well as provide tens of thousands of jobs across several industries, and add taxes to the fiscus to benefit the entire South African economy. They would be more honest if they admitted that the only people who will benefit from importer price control are the importers themselves, who would then be able to charge whatever they like. To suggest that this will benefit the consumer in the long term is laughable, and one has to question particularly SANCU’s logic in supporting these claims,” is SAPA’s opninion.

Market prices are determined by a variety of complex inputs, and these organisations’ claim that the consumer will pay 32% more for chicken is simplistic and uninformed. Previous tariffs had absolutely no effect on retail prices. SAPA says the BFAP figures they quote as source were taken out of context and manipulated to reach a figure to support their irresponsible fear-mongering claims. ITAC has all the pertinent information available to make a decision on the application, including an exhaustive research report executed by an independent economics-based consulting firm, on the potential price effect of the tariff application in question. The report found that sufficient competition exists between local producers and that this, together with the competition created by the big retailers, will keep prices in check.

Ebiesa also claims that it needs to import at dumped prices to be able to export to other countries. “Would it not make more South African sense to support the drive, as SAPA has been doing, that would enable more local producers to export proudly South African chicken to the rest of the world? South African producers are globally competitive – the recent independent study by BFAP and the University of Wageningen in the Netherlands confirmed that SA is the sixth most efficient producer in the world, ahead of every single European country. Our producers can deliver the goods, at competitive prices, but our current regulatory framework requires certain government actions to enable export, which would open doors globally,” says SAPA.

This is one of the items on the table at this present moment, as the chicken industry and government work on creating a masterplan for the industry, which is aimed at transformation and growth. SAPA says it would like to challenge Ebiesa to rather join forces with the local industry and focus its energies on helping to empower emerging black farmers and their export potential. Aside from providing affordable, healthy, safe protein to millions of South Africans on a daily basis, the poultry industry is a national asset. It contributes to the South African landscape across a variety of platforms, from providing employment and training and empowerment opportunities to food security and social upliftment in the areas in which producers operate.

“The poultry industry is willing to take the required steps and make the investments needed for the growth that is essential if we are to have enough food to feed all South Africans in future. Importing dumped chicken from Brazil for the short-term gain of a handful of importers and middlemen is not the answer,” is SAPA’s viewpoint.