South Africa’s poultry production ups 5% attributed to implementation of sector’s master plan

SOUTH AFRICA – Poultry production in South Africa has increased by 5% during the first 8 months of the year, compared to the same period last year, despite the COVID-19 pandemic.

This was revealed by the South African Poultry Association during the 2nd Poultry Executive Oversight Committee (EOC) meeting, as they reviewed the Poultry Sector Master Plan, indicates the Department of Trade, Industry and Competition South Africa.

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The rise in production is forecasted to reflect in the entire year and 2021.

According to a Global Agricultural Information Network (GAIN) recent report by USDA, poultry meat production is projected to rise by 4% in 2021 to reach 1.57 million tons from 1.51 million tons in 2020.

The Poultry Sector Master plan was implemented in last year’s South African Investment Conference.

It was developed in close partnership between government and a number of stakeholders in the industry, including poultry producers, processors, exporters, importers and organised labour.

The objectives of the plan hinge on increasing local chicken production and consumption, while also addressing the exporting of locally produced and raw chicken products.

“The masterplan provides a blueprint for the industry with substantial potential to expand the poultry production across the value chain, especially if substantial export markets can be developed.”

Department of Trade, Industry and Competition South Africa

One of the measures used to accomplish the objective is increased import tariffs.

To this end the International Trade Administration Commission approved the South African Poultry Association’s (SAPA) application to increases the most favoured nation duties (MFN) on imports of bone-in chicken from 37 percent to 62 percent, and for boneless portions from 12 percent to 42 percent which was effected as of March 13, 2020.

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With the new tariffs put in place and rise in production, it is forecasted that the country’s chicken meat imports will decrease by 10 percent in 2020 to 435,000 tons from the 539,000 tons imported in 2019 and further reduce to 357,000 tons in 2021, an 18% reduction.

On the other hand, it is projected that 2021 poultry exports will increase marginally to 51,000 tons.

To drive exports, the poultry industry has strategically prioritised countries like Saudi Arabia, United Arab Emirates and Qatar for export of poultry products.

In addition, the industry will target markets which include SADC countries and those within the African Continental Free Trade Area (ACFTA) and the Middle East.

Further work has also been done with trading partners to improve compliance with sanitary and phytosanitary (SPS) measures which would unlock further export markets.

Under the master plan, poultry producers have pledged to invest R1.7bn towards expansion and improvement of productive capacity.

Some of the investment projects have already been completed including the expansion of hatchery & processing facility and 428 jobs created. 

In addition, the financing model for contract farming has been developed to assist in assessing the producer’s business viability, profitability.

“The South African poultry industry is an important part of the agricultural sector. The masterplan provides a blueprint for the industry with substantial potential to expand the poultry production across the value chain, especially if substantial export markets can be developed,” stated the Department of Trade, Industry and Competition South Africa.

The Master Plan is forward looking and directed at creating a new industry that is dynamic, export oriented, competitive, job-creating and inclusive, as opposed to the one that is reliant on defenses against the challenges of the world.

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