Africa dumping ground for world poultry | IOL Business Report
- 04 Apr, 2019
- South Africa
CAPE TOWN – Southern Africa was fast becoming the dumping ground for chicken from other markets and Africa must stand together to fight dumping from big market players, said Izaak Breitenbach, the general manager for the Broiler Organisation at the South African Poultry Association (Sapa), following the recent dumping of chicken from Brazil in Namibia.
Breitenbach said on Tuesday that it was clear Southern Africa was now in the cross-hairs of exporters for markets for the unwanted leg quarters that were by-products of their lucrative breast-meat exports to the US and Europe.
He added that given similar experience with the effects of chicken dumping in West Africa, it might be necessary for Africa to stand together to fight dumping from big market players.
“Our neighbours to the north have a small chicken industry compared to ours and are even more vulnerable to the devastating effects of uncontrolled dumping, which poses serious risks even to a robust industry.
"As the South African experience proves, job losses are soon to follow, but what is worse is that the investment in a new industry that Namibia embarked on only six years ago, might bear no more than stunted fruit once this predatory trade practice wipes out any possibility of industry expansion and development,” said Breitenbach.
Breitenbach said Sapa members had already joined other producers in the Southern African Customs Union in making an application to the International Trade and Administration Commission for an 82 percent import tariff imposed on Brazil.
“The granting of this tariff would give South African producers some room to breathe, while we work alongside the government on a master plan for transformation and growth for the industry,” said Breitenbach.
Paul Makube, a senior agricultural economist at FNB Agriculture Business, said the livestock sector accounted for 47 percent of total gross producer value in South Africa, with poultry accounting for more than 42 percent of the total value of livestock output and the impact of a contracting poultry industry should be under pressure from cheaper imports and continue to squeeze profitability in the sector, which would be felt throughout the value chain with maize, soyabeans and animal feed industries being affected.
“On the positive side, there is room for expansion as consumption growth is robust and will continue to outstrip production in the medium to longer term. Pressure on feed costs has somewhat dissipated with the recent supply outlook for maize, a major ingredient in chicken feed, showing adequate supplies. The industry will also have to target more export markets," said Makube.