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How the EU drops poultry export prices

Here’s an interesting snippet from the Brussels-based independent organisation epamonitoring.net.

Looking at the tariff restructure South Africa is considering for poultry imports, the organisation considered the contention, raised by FairPlay, that EU exporters are able to adjust their prices to counter South African tariffs. What it found from a review of Eurostat data supports that view.

The average prices of EU frozen chicken exports to South Africa dropped by 30% in Euro terms between 2012 and 2016, from €1.18/kg to €0.83/kg. This was the period when EU chicken exports to South Africa really took off.

Then prices rose in 2017, as widespread bird flu outbreaks resulted in shortages. However, that was followed by another price drop, also 30%, from €1.19/kg to €0.88/kg, between 2017 and 2021.

“Such price falls largely negated the impact of safeguard duties introduced by the South African authorities on imports from the EU over this period,” epamonitoring commented.

The publication also notes that EU export prices (of surplus brown meat chicken portions, such as leg quarters) have nothing to do with EU production costs. Prices are based on “costs of shipping minus the cost of alternative methods of disposal of unwanted poultry parts”.

Which means that if it was cheaper for EU producers to ditch those surplus tonnes of poultry in landfill, they would consider it. So much for the pious talk about helping to feed Africa’s starving millions.

European Parliament building. CC-BY-4.0: © European Union 2020 – Source: EP. CC BY-NC-ND 2.0

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