Chicken Industry

The Twisted Logic of Chicken Dumping

Having grabbed 30% of the local chicken market, and killed thousands of local jobs, chicken importers continue the assault on local jobs.

Unati Speirs, chairperson of Emerging Black Importers and Exporters of South Africa (Ebiesa) argues against higher tariffs to protect the local chicken industry and continues to promote the foreign interests represented by the Association of meat Importers and Exporters (AMIE) in South Africa.

Ms Speirs naively asks why SA is not exporting chicken to the EU, where it has duty-free access, ignoring the fact that the EU uses non-tariff barriers to protect its own chicken industry from competition from imports. The EU publishes a list of the few countries (12 in total) from which it will allow chicken imports and there is not a single country in Africa on that list.

What Ms Speirs fails to acknowledge is that the victims are not only the large producers. Small-scale, emerging farmers are being forced out of business by imports cornering their markets, leaving them and their families destitute, and spreading despair in poor rural areas where unemployment levels are highest. The knock-on effect is massive with thousands of jobs on farms, small businesses in rural towns and related value chains such as the grain industry being imperilled.

Through twisted logic Ms Speirs claims because local producers are “only” able to produce 70% of local requirements and the remaining 30% “has to be” imported because “we need importers to plug the gap”. Like blaming the victim for a crime Ms Speirs argues that since we have crippled local producers we need more imports because local producers are crippled.

That missing 30% constitutes 539 000 tonnes of chicken not produced locally and not providing local jobs; chickens not eating maize and soya produced on South African farms; another agri sector that depend on the local chicken industry to flourish.

South African chicken producers, employing 120 000 people directly and indirectly, are highly efficient – and more efficient that every EU country – despite receiving no government subsidies, yet EU chicken is sold to SA importers at way below their cost of production and putting each of these jobs at risk. Brazil, a more efficient producer with a vast industry built up on subsidies, does the same. It comes as no surprise that this price differential doesn’t reach South Africa’s consumers – imports are sold at or near local market prices, and huge profits are made by importers, middlemen and retailers.