Investigation Of Chicken Dumping Bad News For Consumers

15 March 2021 – Additional duties on chicken imports to stem poultry dumping in South Africa will hit lower-end consumers hard, the Association of Meat Importers and Exporters (Amie) has warned.

Responding to news that the South African Poultry Association (Sapa) has successfully lobbied the International Trade Administration Association (Itac) to investigate dumping with a view to raising imports tariffs, Amie has made a strong claim for considering local consumers.

A press statement by the association says, “not even a year after significant increases to already hefty poultry import tariffs, Itac has announced that it is launching an anti-dumping investigation at the behest of Sapa against Ireland, Spain, Poland, Denmark and Brazil”.

Amie said while all countries had a sovereign right to investigate dumping allegations, such investigations “must be rooted in two fundamental values: fairness and accuracy.

“This is critical, as without these values consumers end up paying more for chicken and South Africa could run the risk of running foul of its bilateral relations with strategic trade partners. These are partners that we rely on for our own South African exports.”

Potentially increasing tariffs on poultry should be seen against the backdrop of warnings issued in 2020, when the South African Consumer Union had said tariffs would inflate in-store prices – a prediction that had come true, Amie said.

A bag of Individual Quick Frozen (IQF) chicken portions rose 9% in price after last year’s tariff increase, from R63.37 to R77.61.

It means that minimum wage earners who depend on affordable protein sources will struggle to continue buying IQF chicken.

“Now poultry producers are asking for even more tariff protection on certain chicken imports. Poultry price increases – which are already exceeding inflation – would make chicken completely unaffordable to the 40% of South African consumers that are already regarded as poor,” the Amie statement said.

Its CEO, Paul Matthew, added that “these tariffs are aimed at cutting out imports completely, and creating a monopoly in the local industry. We need to ask why the local industry pursues protectionism to this extent despite the increases in price to the consumer”.

Amie said the industry needed help but not protection. It said that tariffs were not the way to go to protect local poultry producers, and that consumers ultimately paid the price, and that past experience had shown that pressure on imports was usually eased to lessen the burden on consumers.

“Botswana has banned poultry imports from South Africa and Zimbabwe in the past in order to protect the local industry, even though only 5% of the country’s poultry is imported. However, even that small reduction in imports led to a significant rise in price and the reintroduction of imports as soon as it was feasible.” Source (FreightNews)