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Chicken dumping is no myth

Chicken importers like to pretend that dumping doesn’t happen. There’s plenty to prove that they are wrong – it’s all in the application by the SA Poultry Association (SAPA) for anti-dumping duties against Brazil and four European Union countries.

In the three years to June 2020, more than half of the bone-in chicken portions imported into South Africa were dumped, the application shows. And over those three years, dumped chicken imports totalled R6.4 billion.

That’s R6.4 billion that left the country, benefiting foreign producers and foreign workers. And it’s nearly 426 000 tonnes of chicken not reared in South Africa, not supporting South African jobs and not eating South African feed.

The application is based on dumping margins – the difference between what a product is sold for in the producing country and the import price when the same product is sent to South Africa. The application calculated dumping margins of 110.76% (Brazil), 177.67% (Denmark), 158.42% (Ireland) 35.0% (Poland) and 91.58% (Spain). Clearly there are huge profits to be made from dumping chicken on the South African market.

FairPlay founder Francois Baird took importers’ arguments apart in an article in Business Day in which he listed the ways in which dumping damages the local industry – something else importers like to think doesn’t happen.

While company-specific details have been kept confidential, the application makes clear that local producers have lost revenue, profits and market share. They invested in additional capacity, some of which is lying idle because imports grabbed most of the local increase in demand for chicken. And local producers are fearful about surpluses which might be released by foreign producers as world trade normalises.

The application should be required reading for those who think dumping is a myth.