dti commits to helping ailing poultry industry

09 Jan 2017

Business Report, 09 January 2017
By Siphelele Dludla

Johannesburg – The Department of Trade and Industry (the dti) on Monday said the South African government had been working with the local poultry producers to address the challenges in the industry as a result of chickens imported from European Union (EU) countries.

The dti was responding to the plea made by the Food and Allied Workers Union (Fawu) for government to tighten regulations of imported chickens in a bid to save jobs in the South African poultry industry.

At least three major South African chicken producers have announced steps to begin retrenching more than 3,500 workers combined in order to remain a going concern as they struggle under heavy competition from cheap imported chickens.

The dti said government, through it and the Department of Agriculture, Forestry and Fisheries (DAFF), had initiated measures to protect local poultry producers against unfair competition.

"Over the last three years, upon application by the industry through the International Trade and Administration Commission (ITAC), a number of actions were taken by the government to address the challenges in the industry," the dti said in a statement.

"The actions vary from increase in tariffs covering a number of poultry products in line with South Africa's international commitments, imposing trade remedies where evidence indicates dumping of poultry in the South Africa market or where there is a surge in imports."

The dti said the import duty on a number of poultry products was increased significantly in 2013. The current import duties for chicken imports from countries like Brazil and the United States stand at 82 percent for a whole bird, 31 percent for carcasses, 12 percent for boneless cuts, 30 percent for offals, and 37 percent for "bone-in" portions.

"The above import duties are not applicable to imports from the European Union (EU) since South Africa has a preferential trade agreement with the EU," the dti said.

"However, in 2015 anti-dumping measures ranging from 3,86 percent to 73,33 percent were imposed on frozen bone-in chicken pieces from Germany, the Netherlands and the United Kingdom."

The dti said it was continuously working with DAFF on opening new markets for South African poultry exports.

"Recently new markets in the Middle East have been opened and present a further opportunity for export to the domestic poultry industry in South Africa. "Furthermore, the dti is in the process of considering the designation of domestic poultry products for purposes of public procurement."

The dti said it had established a national committee, which included DAFF and the industry, that would consider all the challenges experienced by the domestic poultry industry and develop a comprehensive strategy to address these challenges in a holistic and sustainable manner.

"As a result of a safeguard investigation on the surge of imports of frozen bone-in chicken pieces from the EU and this investigation conducted by ITAC, a provisional safeguard duty of 13,9 pecent was imposed on 15 December 2016," the dti said.

"This provisional safeguard duty will stay in place until 3 July 2017 while ITAC continues with the safeguard investigation under the article 34 of the Economic Partnership Agreement."

The dti said it was also considering designating chicken for procurement by government and its agencies.