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Potato Industry ‘Under Threat’ As Import Duty Expires

29 July 2021 – The expiry of anti-dumping duties on imported potato chips was a concern not only for South Africa’s potato industry, but also for other industries threatened by dumped imports, said the FairPlay Movement.

The founder of the not-for-profit trade movement, Francois Baird, said that immediately at risk was the potato industry, which had successfully proved that Belgian and Netherlands potato producers were dumping the chips used to make french fries, and had secured anti-dumping duties to level the playing field.

“Those duties were due to expire in 2019, and local producers applied for an extension, known as a ‘sunset review’. South Africa’s independent regulator, the International Trade Administration Commission (Itac), had 18 months in which to investigate that application, but failed to complete the task in time. As a result, by default, the duties fell away in July 2021,” said Baird.

FairPlay said that local producers feared there would be a flood of imported potato chips, or fries, which would grab market share, and believed that job losses were inevitable. Baird said this was what happened when predatory foreign producers took aim at a South African market, as other industries knew only too well.

Baird said container loads of frozen potato chips would soon be on their way to South Africa from Europe.

Potatoes South Africa had not commented on FairPlay’s statement by the time of going to print.

In March, the chief executive of Potatoes South Africa, Willie Jacobs, said that from 2018 to 2020, South Africa produced about 2.5 million tons of potatoes annually in 16 different regions across the country.

South Africa was one of a few countries that could supply fresh potatoes all year round. At primary level, the industry was worth R7.5 billion, and R26bn at secondary level.

The primary potato industry provided work to about 45 000 labourers (permanent and seasonal) on about 570 commercial potato farms. Furthermore, it was estimated that between 2 000 and 3 000 small-holder farmers cultivated potatoes.

Baird said industries such as poultry, steel, sugar and textiles would now be concerned by Itac’s failure to complete an investigation in the time allotted.

FairPlay said it hoped that threatened potato producers would renew their application, and Itac would be able to handle it expeditiously.

“Itac has reportedly never failed before to complete the sunset review, and it should ensure that it never fails again. Whatever went wrong, regardless of whether the fault lies with the organisation or potato producers, or a combination of both, must be addressed to ensure there can be no repetition.” Source (Business Report)