True or False? SAPA fact-checks chicken dumping claims

The South African Poultry Association has released a factsheet which directly answers some of the most common arguments made, often by importers, against anti-dumping duties, and against the local industry’s ability to supply chicken efficiently.

We’ve reproduced some of SAPA’s fact-checks below:

Claim: Local poultry producers are unable to meet local demand.

True or false? False.

“The local poultry industry has increased its production capacity to 22.5-million birds per week, following decades of market contraction due to predatory trade practices like dumping. The poultry industry is poised for even further growth, but not if it is required to compete with dumped imports, which erode market share,” the industry said.

Claim: The imposition of anti-dumping duties had not led to better performance by the local industry.

True or false? False.

“The imposition of anti-dumping duties has made local investment (exceeding R2.1-billion, and creating more than 4,600 jobs in the past four years) and industry growth more sustainable,” the industry said.

“According to BFAP, SA is one of the most competitive poultry producers in the world, and produces the cheapest chicken South African rands can buy – a far cry from where it was a decade ago; in a state of contraction, haemorrhaging jobs and shuttering farms as dumping continued unabated. These defensive trade measures have allowed the poultry industry to lift itself out of the doldrums, and better service South Africans and the communities in which our farmers operate.”

Claim: The imposition of anti-dumping duties led to a reduction in imports.

True or false? False.

There is a difference between fair imports and dumped imports. Anti-dumping duties target dumped imports.

“The imposition of anti-dumping duties led to the reduction of dumping,” the industry countered.

When provisional anti-dumping duties lapsed, and permanent duties were delayed, dumping had resumed. Imports of bone-in chicken portions from Brazil had surged 600% since the suspension of the implementation of the new anti-dumping duties.

Claim: The reduction of “imports” occurred at the expense of increased prices.

True or false? False.

“Loadshedding, the rapid rise of input and feed costs due to the war in Ukraine, as well as failing state infrastructure and wanton lack of service delivery have had a dramatic impact on consumer pricing.

“The potential passthrough of dumping duties to consumers pales in comparison to the inflation brought on by loadshedding and feed costs,” the industry stated.

Claim: Anti-dumping duties contributed to food price inflation.

True or false? False.

This is a “contradiction,” said the industry. When provisional anti-dumping duties lapsed last year, retail chicken prices did not fall – they rose and kept on rising because of increases in the input costs of poultry producers.

The truth, as shown by the Genesis report, is that the price impact of import duties is minuscule compared to the huge effect of load shedding and feed price rises following the Ukraine war. As SAPA said, load shedding adds “rands per kilogram” to chicken prices; import tariffs might add “a few cents”.