South Africa imposes duties on some poultry meat imports

South Africa’s trade regulator has announced a temporary increase in antidumping duties on select frozen poultry product imports from four leading exporting nations.

(mtrommer | Bigstock)
(mtrommer | Bigstock)

In a move welcomed by the poultry sector, South Africa’s trade regulator has announced a temporary increase in antidumping duties on selected frozen poultry product imports from four leading exporting nations. However, the change looks likely to add to the economic conditions that are likely to drive up chicken prices in the country.

The change will apply to product from Brazil and four European Union (EU) countries, namely Denmark, Republic of Ireland, Poland, and Spain, reports MoneyWeb. According to this source, poultry meat from these countries present a “major threat” to the South African poultry sector in terms of production capacity and employment prospects. 

According to national trade movement FairPlay, these tariffs will remain in place until June of 2022. By that time, the country’s trade regulator is scheduled to have completed its review of the nation’s poultry industry’s case against these five countries. 

On behalf of FairPlay, its founder Francois Baird has welcomed the news of the temporary import tariffs. They will help to provide a level playing field for South African poultry producers until the final decision on the issue is made by the regulator, the International Trade Administration Commission (Itac). 

“FairPlay has repeatedly called for speedier action on anti-dumping applications, and we are pleased with this decision,” he said. “Moreover, this is another nail in the coffin for dumping and predatory trade denialists.” 

Higher chicken prices forecast

For South African consumers, the additional import duties will likely be among the factors driving up chicken prices in 2022. 

Provisional anti-dumping duties imposed on imports of frozen chicken range from 85% for Spanish product to 265% for Brazilian chicken, reports Fin24. For Ireland and Denmark, the new rate is 158%, and 97% for poultry from Poland. The duties apply to bone-in chicken imports — such as drumsticks, thighs, and leg quarters — from the EU exporters. Brazilian products affected are bone-in chicken portions and breasts.

As well as the additional import duties, increased transport costs will also drive up chicken prices in South Africa, warned the Road Freight Association. 

As chicken is transported many times between farm and consumer, overall production costs will be particularly affected by a recent record gasoline price hike in South Africa. Furthermore, the comparative weakness of the country’s currency (rand; ZAR) against the U.S. dollar and a fall in business confidence will also push up chicken prices for consumers.

Reaction from South African poultry producers

According to the South African Poultry Association (SAPA) reported by the same source, the latest announcement over selected additional duties on imported chicken is a positive step.  

“South Africa’s poultry industry has been plagued by the long-term impact and challenges posed by the dumping of chicken into our market,” said SAPA Chairperson Aziz Sulliman. “This has been devastating to South African producers. Our spirits are buoyed by this announcement as the industry has highlighted this problem for many years.”

In the latest SAPA Poultry Bulletin, Sulliman stressed that the South African poultry industry is globally competitive. While it does not need protection from legal trade, illegal and unfair trade needs to be eradicated, he said. 

The latest duties to be announced represent a win for South Africa’s poultry farmers, reports Citizen. It defines dumping as the importation of products at prices either lower than production costs, and/or lower than the selling price for the same product in their home markets.

Over the past 20 years, imports are alleged to have cost thousands of South African jobs, and pushed the country’s small-scale producers out of business, according this source.

In a review of 2021 in Poultry Bulletin, Izaak Breitenbach reported that total poultry imports for the year were 14% below the level of 2018. For bone-in imports, the reduction was 44%, according to the SAPA member. He added that a review of all poultry meat trade measures has been completed, including the renewal of anti-dumping duties against the EU, Germany, and the Netherlands.

In addition to these trade issues, South Africa is among the countries in Africa (and elsewhere) to have recorded outbreaks of highly pathogenic avian influenza during 2021. 

The current state and future prospects for the South African poultry industry are explored in an article in Poultry International December 2021.

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