Local poultry producers have said they won’t invest in the industry as long as the Department of Trade and Industry is giving Brazil, Denmark, Ireland, Poland, and Spain a break from definitive and anti-dumping duties. According to IOL, this is because the Department of Trade and Industry is giving Brazil, Denmark, Ireland, Poland, and Spain a break from definitive and anti-dumping duties.
According to IOL statement, Izaak Breitenbach, the General Manager of the South African Poultry Association (SAPA), said that the industry felt betrayed by the Minister because his decision went against the spirit of the poultry Masterplan, which was to limit imports to help the local industry grow.
Breitenbach said that so far, the industry has spent R1.5 billion to increase the amount of processing that can be done locally in support of the Masterplan.
He said that this investment in South Africa’s Agri-processing sector has helped the local economy by making more than 1,500 new jobs.
He said that new farmers have spent more than R600 million to build new farms to support the increase in capacity at a time when high input costs are hurting the industry because of global macro-economic problems.
“One good thing about the news is that anti-dumping duties will be put in place against Brazil and four EU countries, even though they will be put on hold for 12 months. After that, the new duties will be in place for four years. Due to the uncertainty in the near future, it’s too bad that local producers think they might have to put off investments and projects that are already in the works for at least a year, Breitenbach said.
He said that the industry is thinking about what options are available to them, but that until they understand the details of the announcement (such as the level at which the duties will be set and the exact date of implementation, which will be at the end of the 12 months announced on August 1, 2022), they haven’t decided what to do next, other than to say that they will work with Minister Ebrahim Patel.
Fairplay, a market watchdog that works with SAPA, said that the 12-month delay would undo the progress made in putting the poultry master plan into action, which Minister Patel has been pushing since he signed it in 2019.
“By letting Brazil and other countries dump as much as they want in the next 12 months, Patel has put at risk the poultry farmers who signed the master plan in good faith and with high hopes,” said Fairplay founder Francois Baird.
Baird made it clear that right now, this license to dump only applies to Brazil, and that Denmark, Ireland, Poland, and Spain can’t send goods to South Africa because of bird flu restrictions.
But these bans are only temporary, and they may be lifted well before the 12-month “duty-free” period ends.
“Minister Patel’s poorly thought-out decision has led to more unemployment and suffering in rural areas that were already poor. He needs to think about it again and change his mind.
If Minister Patel really wants to help the poor, he should ask his cabinet colleagues to take the 15% value-added tax off the chicken portions that low-income households eat the most. And he should tell importers, wholesalers, and retailers to pass on the benefits of cheap and dumped imports to consumers, Baird said.
The Association of Meat Importers and Exporters (AMIE) is laughing about the decision made on Monday. They say it’s a big win for millions of South African consumers who are short on cash.
“Liberalizing trade rules can be good for consumers. The opposite is true of localization and protectionist policies, which limit competition and make local goods more expensive. We’re glad that the government has seen that the timing and scope of these policies need careful thought and has put off putting tariffs in place for a year. It shows that the government is putting its people first, which is exactly how it should be, said AMIE CEO Paul Matthew.
Fairplay says that the flood of cheap poultry products coming in from other countries has been getting worse recently, and that the only thing stopping it was the temporary tariffs that ended last month.
Baird said that there had also been growth in Australia, which had not been taken into account before.
He said that over the past year, there had been a 37% rise in the amount of whole birds dumped, of which 44% were whole birds, a 61% rise in bone-in chicken, a 54% rise in offal, and a 53% rise in mechanically deboned cuts.
“The Minister’s announcement just gives importers a break for a year, and any “cheap” chicken imports go straight into the importer’s pocket as healthy margins. There is no proof that dumped chicken is sold at a low price by importers to consumers, and once again, importers will take advantage of the situation by taking part in unfair trade practices. Already, the total amount of chicken imported is more than what South Africa’s biggest local producer makes,” Breitenbach said.
