Hammarsdale reopens after decades of dumping damage

The 2017 Hammarsdale closure highlighted the crisis in the South African poultry industry because of nearly two decades of chicken dumping.

Import volumes had risen steadily, with devastating consequences for chicken farmers. Rainbow downsized and restructured its operations; many smaller operations had closed, with the loss of more than 6 000 jobs.

Some 1 200 jobs were lost at Hammarsdale alone, as the plant was shuttered and poultry farms were sold off. Workers struggled to find new jobs in an area that had been hit before – Hammarsdale used to be a textile hub, but those jobs were lost when cheap imports closed its garment factories.

Two years later, in 2019, the poultry master plan was launched as a result of crisis meetings between government and poultry producers. The master plan aimed to stabilise and revitalise the South African poultry industry. It planned to create nearly 5 000 jobs by expanding the industry to cater for increased local consumption and to serve new export markets.

There would also be a focus on reducing imports to a smaller portion of the South African market, with an undertaking to “act decisively” against dumped and illegal chicken imports. That commitment bound all signatories – the government, the poultry industry, labour and chicken importers.

Unfortunately, the launch of the master plan was followed a few months later by the Covid-19 pandemic, which brought most plans to a crashing halt for nearly two years. As a result, many of the master plan’s objectives are way behind schedule. Domestic chicken consumption is down, and chicken export volumes in 2022 showed no increase since the plan was signed in 2019.

One participant that has exceeded its master plan targets is the South African poultry industry. Investment in capacity expansion has topped R1.8 billion, more than the R1.5 billion to which it had committed, and a further R600 million is planned by the end of 2024.

Part of that new investment is at Hammarsdale. Rainbow has invested R220 million, and contract growers will be responsible for another R400 million. Nearly 500 new jobs have been created at the re-opened production plant and on the farms and industries serving it.

The master plan is not working everywhere, but its potential is evident at Hammarsdale.

New production, new jobs, and new hope.