Chicken Industry

Easing of lockdown reignites fears over ‘chicken dumping’

Any gains intended by South Africa’s Poultry Sector Master Plan to reinvigorate the country’s long-ailing broiler value chain will be severely compromised should large-scale dumping of imported chicken meat onto the local market resume.

This article was written by Lloyd Phillips and originally publichd in Farmer’s Weekly on 1 September 2020. Access the original article here or continue reading below.

Countries and regions such as Brazil, the US, and the EU currently have “mountains” of frozen chicken meat supplies that built up due to international COVID-19-related trade restrictions, that they now need to get rid of.

This was according to Francois Baird, founder of FairPlay, who said these chicken-exporting countries would be looking closely at countries where they have successfully dumped their products before, including South Africa.

Farmer’s Weekly previously reported that South Africa’s broiler value chain had welcomed the March 2020 announcement by the Minister of Trade, Industry and Competition, Ebrahim Patel, that the import tariff on frozen bone-in chicken portions would increase from 37% to 62%, and for frozen boneless chicken cuts it would increase from 12% to 42%.

At the time, the poultry industry expressed its hopes that these measures would deter continued dumping of low-cost chicken arriving from certain parts of the world.

Statistics published by the South African Revenue Service showed that from 2016 to 2019, well over 500 000t of poultry meat was annually imported into the country. The vast majority of this comprised chicken.

Izaak Breitenbach, general manager of the South African Poultry Association’s Broiler Organisation, agreed with Baird that there was currently a global oversupply of chicken meat, but added that this applied to South Africa as well.

“Pre-COVID-19, South Africa was the third biggest [chicken] importer from Brazil, while also the fifth biggest [chicken] importer from the US,” Breitenbach said.

He also said that a study by South African foreign trade consultancy firm, FC Dubbelman & Associates, previously found that “90% of imported [chicken] meat sold in South Africa was sold below the exporting countries’ production costs and/or the chicken sales prices in those countries”.

Both Baird and Breitenbach said they were aware of the imminent launch of a website by Brazil and the US reportedly to promote their chicken meat to the South African public.

In light of this launch, Baird warned South Africans to be sceptical of any information on the website that could attempt to allay their concerns regarding a resumption of chicken dumping on the national market; that chicken imports were necessary because South Africa’s broiler value chain was allegedly incapable of producing sufficient chicken for the country’s consumers; and that competition from imported chicken would be a constructive motivation for South Africa’s allegedly inefficient broiler value chain to improve.

“We have seen these false flag arguments before, and we think that these and other items of false news about South African chicken are coming again,” said Baird.