SOUTH AFRICA– The South African Poultry Association (Sapa) has issued a warning in response to the South African government’s consideration of a temporary deduction on poultry meat import duties.
The move, aimed at mitigating South Africa’s bird flu outbreak, has raised concerns that it could deliver a severe blow to the local poultry industry, which is already grappling with multiple challenges, including load shedding.
The International Trade Administration Commission (ITAC) recently announced that Trade, Industry, and Competition Minister Ebrahim Patel had instructed them to explore the possibility of creating temporary rebate provisions for meat and edible offal, specifically fresh, chilled, or frozen fowls.
The directive came after discussions between Minister Patel and Agriculture, Land Reform, and Rural Development Minister Thoko Didiza.
Meanwhile, the bird flu outbreak has resulted in the culling of approximately 2.68 million chickens with producers having culled about 30% of their flock in the past two months.
The industry is already facing significant losses, with major poultry producers reporting losses even before the outbreak due to rising costs associated with load shedding.
Izaak Breitenbach, General Manager of SAPA’s broiler division, expressed deep concerns about the potential impact of temporary rebates on the poultry industry.
He cited losses of approximately half a billion rand due to avian influenza reported by just three major companies; Rainbow Chicken, Quantum, and Astral. These losses have led to job losses and economic decline within the industry.
Breitenbach argued that South Africa already had five countries open for poultry imports, including Spain and Ireland, which were not subject to import duty tariffs.
He emphasized that these markets, along with others such as the US and Brazil, could adequately supply the necessary poultry imports without the need for additional rebates.
In addition, he noted that the import duties recently imposed on countries like Brazil did not halt imports but rather affected prices.
“These duties resulted in imports taking place at more reasonable prices, ensuring a level playing field for local producers,” he stated.
While Minister Patel’s consideration of temporary import rebates might aim to alleviate food shortages during an election cycle and the upcoming festive season, analysts like Anthony Clark of Small Talk Daily argue that it could have serious consequences for the already struggling poultry sector.
He called for government support for the local poultry industry through a compensation fund to offset the losses incurred due to avian influenza and other challenges.
Clark criticized the government for repeatedly altering trade policies, such as imposing tariffs and then relaxing them, causing uncertainty in the sector.
He also highlighted the importance of addressing fundamental issues such as the provision of essential services like water and electricity.
The poultry industry’s warning underscored the delicate balance policymakers must strike between ensuring food security and protecting local industries from external competition, particularly during times of crisis like the bird flu outbreak.
