Chicken Industry

Investment Conference plan aims to restructure poultry industry

The South African poultry industry warmly welcomed the introduction of a long-awaited poultry sector master plan, which aims to restructure the troubled industry that has haemorrhaged thousands of jobs.

This article is reproduced courtesy of IOL. Original article by Siphelele Dludla. Access the original here.

The plan was finally signed at the second SA Investment Conference after year-long negotiations.

The poultry industry earlier this year committed an investment of R1.5 billion towards the objectives of the plan.

The Department of Trade and Industry (dti) will make an official announcement soon.

According to the DTI spokesperson, Sidwell Medupe, the department was ironing out the final touches of the plan, but wanted to make the announcement at the Investment Conference.

“We have not even drafted a statement about the implementation of the master plan… we will call a media briefing with all stakeholders soon to make an official announcement,” Medupe said.

According to the industry spokespeople, the poultry master plan’s objectives include the expansion of local industry capacity and ensuring that locally produced product makes up an increasingly larger proportion of consumption over time.

The master plan gives priority to five pillars that will be instrumental in refocusing the sector, with targets to be met by 2023.

First, it calls for establishing partnerships to increase production and availability of feed and simultaneously ensuring that workers are provided with training and development opportunities.

It calls for driving domestic demand and the affordability of local broiler products, and calls for the establishment of safety and veterinary requirements within markets, offering producers opportunities for exporting their chicken products, meeting their needs, and commencing exports by the end of March next year.

The South African chicken industry has been beset by numerous challenges in recent years, including the cost of feed, barriers to export and “dumping” of chicken imports from Brazil, the EU and the US.

The South African Poultry Association (Sapa) said yesterday that the plan made provision for addressing many unfair trade practices, including dumping and a number of food safety sins that related to imports for the potential dangers they posed to consumers.

“All parties agreed on the harm caused by rogue imports to the industry, to the import sector, and to the economy; as well as the urgent need to enforce regulations more stringently,” said Izaak Breitenbach, the general manager of Sapa’s Broiler Organisation.

The FairPlay movement, an NGO advocating for the end of predatory trade practices, said it welcomed the developments in the plan, but felt that an opportunity for aggressive job creation had been missed.

“The key to success will be the effectiveness of government measures to restrict imports, firstly through a tariff announcement expected soon,” said FairPlay founder, Francois Baird.

“The strength of the government’s intent will be shown by the percentage tariff it is prepared to impose to restrict Brazilian chicken imports.”

Sapa and the Association of Meat Importers and Exporters (AMIE) have been at odds over proposed tariff increases on chicken portions imports to protect the domestic industry.

A final decision on the level of the tariff by Minister of Trade and Industry Ebrahim Patel is expected soon.

AMIE chief executive Paul Matthew said AMIE was committed to fully participating in a process that held benefits for the entire poultry sector.

“The objectives of the plan hinge on increasing local chicken consumption and so growing the demand for chicken, while also addressing the exporting of locally-produced cooked and raw chicken products.

“Target markets will include SADC countries and those within the African Continental Free Trade Area area and the Middle East. Gearing up locally will also open European markets,” Matthews said.