New anti-dumping duties will help chicken farmers, says SAPA

The realities of the new anti-dumping duties against chicken imports from Brazil and four EU countries were spelled out by Izaak Breitenbach of the SA Poultry Association (SAPA).

The duties would probably reduce import volumes from these countries by 10% or less, and would not have a material impact on retail chicken prices, Breitenbach said in an interview with Moneyweb.

What the duties would do is to bring some relief to an industry that had been struggling with the impact of power cuts, known as load shedding, rising input costs such as feed, as well as dumped chicken imports.

“Now, what this duty will do for us is that it’ll give us the breathing space to carry on investing in this industry, to carry on creating economic growth in the industry and the longer value chain, as well as doing transformation,” Breitenbach said.

“So all in all this is just positive for the industry.”

He did not agree with a suggestion that the duties were just protectionism. “If we look at the amount of dumping that took place in South Africa in the chicken industry, we have had nine countries dumping chicken in South Africa at prices as low as 50% of the production cost of chicken.”

Consumers hadn’t benefited, because importers did not pass on the low prices at which they imported dumped chicken.

Pressed about retail prices, Breitenbach said demand was currently low because of winter. The industry had increased capacity in terms of the poultry master plan.

“We have fridges full of chicken, so I don’t expect a chicken shortage and neither do I expect that this duty will have a material impact in raising prices to the consumer,” he said.

The outlook had improved slightly because of lower levels of load shedding, and there had been a tapering off of feed price increases. While there was no guarantee this would continue, “the picture is a little bit more rosy,” Breitenbach said.