Surprise! Chicken importers want more imports

Higher levels of chicken imports are exactly what chicken importer Fred Hume is calling for.

In a statement full of inexactitudes, Hume accused the local poultry industry of being unable to produce enough chicken for the market (the industry has said repeatedly that capacity is up by 10%). He said bird flu in the Western Cape could cut chicken production (initial outbreaks were in egg producing establishments, not chicken producers). And he exaggerated the anti-dumping duties due to be imposed on chicken imports from Brazil and four European Union countries.

The point is that those anti-dumping duties have not yet been put into effect, and as an importer, Hume wants that to continue. So he’s asking the government to extend the suspension instead of ending it.

Last August, the government agreed that dumped chicken imports from the five countries were harming the local industry, and that anti-dumping duties were necessary. However, citing concern about rising food prices, Trade, Industry and Competition minister Ebrahim Patel decided to suspend the imposition of those duties for a year.

They are due to come into effect this August, but Hume doesn’t want that to happen. And to illustrate how the anti-dumping duties could price imports out of the market, he says they amount to 158.4% on chicken imports from Ireland, 265% on Brazil, 96.9% on Poland, 85.8% on Spain and 67.4% on Denmark.

What he doesn’t say is that most duties will be a lot lower than that. What the government has approved are a range of duties for each country, with duties well below 10% for named producers (who presumably supply most of the imports) and higher duties for everyone else.

In Brazil’s case, the duties range from 3.31% to 265.1%; Denmark is 7.75% to 67.4%; Spain is 7.56% to 85.8% and Poland is 2.25% to 96.9%.

And Ireland, now cleared to resume chicken exports to South Africa, will not be subject to 158% anti-dumping duties, as Hume claims. According to Report No 695 from South Africa’s trade regulator, the International Trade Administration Commission (ITAC) the recommended duties on Irish chicken imports will range from 2.49% to 37.52%.

What Hume also doesn’t say is that the anti-dumping duties are not on all chicken imports from these countries – only frozen bone in chicken portions such as leg quarters which ITAC says are competing unfairly with local products and harming the local industry.

Anti-dumping duties are not a general tariff. They are penalties, decided after official investigation, to correct unfair pricing and ensure fair competition. If those penalties price certain imports out of the market, that shows they were not competing fairly in the first place.