The Brazilian Association of Animal Protein claims that higher import tariffs will hurt consumers as they would have to pay more for imported chicken and “there would be a lack of supply” by SA’s producers (Poultry imports tariff hikes —‘will hurt SA’, January 14). This is simply untrue.
Equally untrue is their further claim that domestically produced chicken combined with imports result in a partnership that creates jobs and gives SA families access to healthy, top-quality poultry meat.
The fact is that we don’t need to import chicken — SA can produce enough chicken locally. Imports have forced local producers to cut back on production, leaving them with spare capacity. As a result, they cannot achieve economies of scale, which reduces their profitability and has already caused job losses.
Higher import tariffs will allow local producers to step up supply, using capacity they already have to replace more expensive imports.
Furthermore, jobs will be created and the benefits of economies of scale will drive prices down. Consumers will certainly not be affected negatively.
In fact, consumers are likely to benefit from increased access to safe, top-quality chicken meat. Brazilian chicken producers do not have a sterling food safety record and, counter to the rules that apply to local producers, detailed labelling is not required for imported chicken.
The Brazilian producers also say that the argument that SA faces profit challenges and job losses due to imports of frozen chicken, “does not sustain itself”. This is rather cheeky, coming from an industry that is sustainable only because it receives generous subsidies and other payments from the Brazilian government.
As the article correctly states, FairPlay supports the SA Poultry Association’s application to Itac to increase the ad valorem tariff on bone-in and boneless frozen chicken portions. Our support rests on our often and outright stated belief in international trade that respects the rules and takes place on a level playing field.
Increasing the existing tariffs will achieve these outcomes.
Francois Baird, founder, FairPlay