Poultry industry calls for VAT-free chicken

A further look at the problems facing the poultry industry were given by the SA Poultry Association (SAPA).

In the latest edition of the magazine Oilseeds Focus, SAPA’s Izaak Breitenbach said “a cloud of uncertainty” continued to hang over the country’s poultry sector. Large poultry companies had stopped investing money in the industry.

“A few months ago, we believed we could count on a significant R600 million investment from the poultry industry on the back of promises made in the Poultry Master Plan.

“Today, however, that amount has shrunk to R280 million after Astral Foods decided to rather put its expansion plans on hold. And who can blame them? The sector has been bleeding for months,” Breitenbach said.

“Input factors such as load shedding and soaring grain prices have also had a disastrous impact on the local poultry industry’s margins. Load shedding alone contributes substantially to the price of locally produced poultry, with anti-dumping duties adding a few cents on selected imports.”

Breitenbach said dumping added to the burdens of “a local poultry industry under pressure”.

“South Africa is rated as one of the top three most competitive poultry producers in the world, but no one can compete with dumping.

Breitenbach repeated the industry’s call for the removal of the 15% value added tax from chicken portions.

“Most of our local producers are already subsidising many of their production costs to offer South African consumers the cheapest poultry meat money can buy. This is, however, not sustainable. 

“We need immediate relief for our most vulnerable. Hence, we remain firm on our position that government should consider scrapping value-added tax (VAT) on selected poultry products – the load shedding tax is already too much,” Breitenbach said.