Chicken Industry

SA consumer watchdog ‘serves Brazilian chicken interests’

Reproduced courtesy of BusinessReport. First published on 29 April 2019. Access the original article here

JOHANNESBURG – A South African consumer watchdog that used to be against predatory trading practices like dumping has apparently switched sides.

In what appears to be a negation of its own position, the SA National Consumer Union (Sancu) has now lent its name to the campaign of Emerging Black Importers and Exporters South Africa (Ebiesa) on behalf of Brazilian chicken exporters.

The campaign to support Brazilian predatory trade in South Africa is almost encouraging, if cynical and desperately sad.

Encouraging, because it indicates that there is a real chance of the South African government approving a tariff increase and, in doing so, supporting local workers and emerging black farmers whose jobs and livelihoods are being decimated by the flood of questionable Brazilian chicken imports.

Cynical, because Sancu’s support for Brazilian products comes at a time when many other countries, including EU countries, are banning Brazilian chicken imports due to food safety concerns.

Sancu and Ebiesa’s position is also desperately sad because it aims an arrow at the heart of rural South Africa. Chicken production is not an urban enterprise. When opportunistic imports destroy jobs, the sustainability of the rural economy is directly endangered. If Sancu and Ebiesa had announced a campaign to promote SA chicken exports, they would be standing on the side of black chicken farmers and jobs for rural areas.

Instead, these two Brazilian handmaidens make spurious claims about consumer price increases should Brazilian producers be reined-in with tariffs, and justify their position by playing the race card.

In reality, the 32 percent price increase claim is untrue, and their campaign could end up destroying wholly black-owned companies like Daybreak Farms, one of the five biggest local producers.

Another reality is that emerging farmers are often the first and the hardest hit by imports. When the market for their products disappears, they simply go out of business and their employees lose their jobs.

These people are the reason FairPlay supports the application for increased tariffs: we want fair trade practices and competition that serve the interests of local small farmers.

The requested 82 percent tariff will only affect the profit margins of the exporters. Should it be implemented, Brazilian producers would simply lower their asking price, because their prices aren’t linked to real production costs and they’ve already made their profits selling breast meat to Europe and the US.

Finally, Sancu and Ebiesa should be more concerned about Brazil’s much-publicised food safety issues before campaigning on behalf of its producers.

While local producers are held to strict traceability requirements, imported chicken enters South Africa in frozen bulk packs and is allowed to be thawed and repacked with only a vague reference to its country or countries of origin.

Brazil’s strategy is to achieve South African market domination and price control to the detriment of local consumers and the entire domestic poultry value chain.

Instead of aiding and abetting this, Sancu and Ebiesa should serve South African interests, and support FairPlay against predatory trade.