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Imports exert pressure on South Africa's poultry industry

by 5m Editor
13 May 2005, at 12:00am

SOUTH AFRICA - Although South Africa's local broiler industry has come under pressure, especially from Brazilian imports, buoyant local markets and low maize and feed prices have helped to moderate the effects.

Imports exert pressure on South Africa's poultry industry - SOUTH AFRICA - Although South Africa's local broiler industry has come under pressure, especially from Brazilian imports, buoyant local markets and low maize and feed prices have helped to moderate the effects.

Zach Coetzee, the spokesperson for the Southern African Poultry Association, said the "big trouble for the poultry industry is imports".

At the association's annual conference last week, Coetzee said: "With imports at present being high, one can only hope that it would not lead to an oversupply. If the market was not so buoyant and maize and feed prices had not dropped, we would have been in trouble. " "Imports are opportunistic and respond to seasonal demand."

Despite import duties, imports can be as high as 17,000 tonnes a month, while exports from South Africa are between 4,000 and 6,000 tonnes a year. About 18 percent of locally consumed poultry was imported, Coetzee said.

Connie du Toit, the chairman of the Broiler Producers' Organisation, said: "Imports are opportunistic and respond to seasonable demand. Imports increase around Christmas."

Exports of broiler meat were being hampered by United States and European sanitary measures. "We see this as an artificial barrier," Du Toit said. South African producers export to the Middle East and elsewhere in Africa.

An anti-dumping duty of R2.40 a kilogram, which was imposed in 2000, is levied on US imports. Coetzee said this was being reviewed, and the industry would make representations to the International Trade Administration Commission of SA to keep the duties in place.

Import duties on products from elsewhere are 27 percent on whole birds, 5 percent on boneless meat and 27 percent on offal.

Du Toit said a 1 percent surplus or shortage could have a 10 percent impact on the retail price either way. "If you cannot sell products, you either have to put it in cold storage, which is expensive, or drop the price in order to move the product."

Coetzee said imports were more of a threat to small producers, which were more sensitive to price fluctuations than larger players.

Currently, 76 percent of imports are from Brazil, which produces far more cheaply and efficiently than South Africa. Six percent of imports are from the United Kingdom, 5 percent from Canada and the balance from Argentina.

Coetzee said local broiler production at high altitude resulted in faster-growing birds but at a higher mortality rate. The policy of establishing many small broiler producing units had encouraged the spread of disease.

These had impacted on competitiveness, but high sanitary standards from retailers and pockets of increased efficiency meant the industry compared well with global standards.

The local poultry and egg industry last year produced 808,159 tonnes of meat and 300,000 tonnes of eggs. At producer level, it is valued at over R10.6 billion and at retail level R17.6 billion. The industry employs over 74,000 workers directly and indirectly.

The industry consumes 69 percent of the feed industry's output and 15 percent to 25 percent of the total maize crop.

Source: eFeedLink - 12th May 2005

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