Despite being the highest per capita consumer of poultry products on the African continent, and the ninth-highest consumer in the world, South Africa finds its poultry industry in deep crisis, buy local campaign Proudly South Africa (SA) said at its first yearly poultry forum on Tuesday.

Faced with cheap imports from the US, Brazil and the European Union (EU), as well as with the additional devastation wreaked by the avian flu epidemic, the forum aimed to address some of the challenges, which include import tariffs, free trade agreements, dumping and the mislabelling of packaging.ADVERTISEMENT

With procurement identified as one of the critical levers to be used in the reindustrialisation of the South African economy, Proudly SA CEO Eustace Mashimbye noted that the poultry industry could also benefit from this.

Nonprofit organisation Fair Play CEO Francois Baird, meanwhile, noted that while poultry dumping has slowed down, the South African government has not promulgated the necessary measures, as proposed by its own Chicken Industry Taskforce.ADVERTISEMENT

To avoid a crisis in the sector, he said, the tariffs between South Africa, the EU and Brazil need to be levelled, while the same sanitary and phyto-sanitary measures need to be applied to all countries.

“This would also require the same packaging and health rules for imported chicken that is applicable for locally produced product. However, transformation is hampered by the inability of government to implement sensible measures of stability and sustainability proposed by its own task force.”

This, he elaborated, could only be achieved through the reduction of predatory trade, while the stabilisation and transformation of the industry needs to remain a top priority.

South African Poultry Association (SAPA) Poultry Disease Management Agency director Ziyanda Majokwenihighlighted that a holistic approach is needed to ensure the sustainability of the industry, which is underpinned by the consumption of poultry.

However, she warned that the industry needed to ensure that tariff negotiations and policy developments speak to the outcomes needed in the industry.

Meanwhile, Department of Trade and Industry (DTI) agroprocessing director Imameleng Mothebe said the DTI remains committed to growing the South African manufacturing sector.

She cited the R1-billion agroprocessing initiative launched by the DTI at the start of the current financial year, as one way in which the department is trying to assist the poultry industry

“The government is doing what it can, but the important thing is to ensure that the public is aware of the issues in order to pay allegiance to locally grown and produced products. This, in turn, will also assist the distressed poultry industry,” she noted.

INDUSTRY OUTLOOK
Bureau for Food and Agricultural Policy commodity market division manager Tracy Davids noted that the poultry industry is the largest agricultural sector in South Africa, as it accounts for 65% of meat consumption in the country.

“The poultry, or broiler, industry, accounts for about 16% of the gross agricultural production value by employing about 48 000 people – according to 2015 figures,” she elaborated.

However, she noted at the forum that the broiler and poultry industry is currently in distress, with chicken prices having increased by 50% between 2010 and 2016.

The prices of feed, such as maize, however, more than doubled over this period.

“South African feed costs are relatively high, which affects the poultry industry substantially in terms of input costs. However, the industry is seeing huge technological advancements, but still requires high levels of specific investment,” she said.

This, Davids added, leads to South Africa being a small player in a global market, where competition through trade is provided through access to technology.

South Africa has, however, improved in terms of production, technical and economic efficiency.

“South Africa has caught up with the global cycle for feed prices, but imports and high feed costs have been tough to deal with in terms of profitability,” she noted.

While a lot can be done to improve the current situation, Davids warned that imports and the other challenges are not going to go away completely.

“Long-term sustainable production must be prioritised, with a market structure similar to global competition and which lends itself to technically efficient production

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