Chicken Industry

LETTER: EU continues to dump poultry in SA

Europe’s trade bloc is a bully when it comes to poultry. This letter was first published in the Business Day on 12 July 2020.

The EU can be, and has been, a good friend to SA. It is just a pity that when it comes to poultry, its nasty side is often on display. Worse, it looks like that will not change.

Successive trade agreements since 2000 have given SA industries duty-free access to the huge EU market. Trade flows in both directions have improved, with benefits for SA agriculture and other industries.

Except for poultry. The first trade deal in 2000 started a flood of duty-free chicken imports into SA. Local producers were hammered as unfair predatory imports took market share. Businesses contracted or closed, and thousands of jobs were lost.

Because EU consumers prefer white breast meat, EU poultry producers had surpluses of brown meat such as leg quarters, which they exported below cost. They focused heavily on Africa — Ghana, Cameroon and SA were among the sufferers.

Trade deals gave EU producers unrestricted access to these markets, with only a few limits. Dumping could be countered by anti-dumping duties. Safeguard duties could protect industries against a sudden surge of imports. Both measures have been used, but with little effect.

SA has anti-dumping duties against three EU countries, but it looks like EU dumping has continued. It has safeguard tariffs against all EU countries, which the bloc is seeking to overturn. Its heavily subsidised poultry farmers continue their predatory trade in chicken here, affecting local production and local jobs.

The local chicken industry is investigating anti-dumping complaints against another four EU countries, which would bring the total to seven. This is urgent, because new stockpiles have built up as the coronavirus cut demand.

When it comes to poultry, the EU is not always a friend. It is often a trade bully.

Francois Baird. Founder, FairPlay