The food industry has welcomed government’s decision to suspend anti-dumping duties on bone-in chicken for 12 months to alleviate supply shortages and rising food costs.
However, officials also urgently need to consider suspending all import duties on the vital protein and
not just anti-dumping duties to manage “the tsunami” of price hikes being experienced around the world, warns leading import-export business Hume International.
On Monday, the Department of Trade, Industry and Competition published a Government Gazette announcing that Trade Minister Ebrahim Patel had considered concerns regarding rapid food price increases, and made the critical decision to temporarily suspend anti-dumping duties.
The gazette particularly noted fears regarding the impact that additional anti-dumping duties would have on the price of chicken as one of the more affordable protein sources for poor and vulnerable families.
“This decision does constitute a win in the short-term which will help to secure supply at a critical time for consumers, and I believe that the Minister should be applauded for heeding industry concerns,” says Hume International Managing Director Fred Hume.
“This said, the local poultry industry is still being protected by punitive and overly zealous import duties on bone-in chicken, so all that this announcement means is that imports will trickle in rather than stopping altogether.
“The only action right now that will result in a meaningful drop in the price of poultry meat is the complete suspension of all import duties on bone-in chicken in their totality. We would strongly urge government to consider the difficult global environment, and take concrete action to protect cash-strapped consumers at shopping tills.”
Notably, bone-in chicken from the countries targeted by the proposed anti-dumping duties, including Brazil, Denmark, Ireland, Poland and Spain, are still subject to import duties of between 62% and 82%. Meanwhile, National Agricultural Marketing Council (NAMC) figures show that South Africa imported some 116,089 tons of chicken in the first quarter of this year, demonstrating the local market’s dependence on imports to meet demand.
Amidst the growing cost-of-living crisis, the importance of chicken to local plates has only grown over the past few months as consumers shop down from more expensive beef and lamb products, notes Hume.
Producers are under enormous pressure to provide enough chicken to meet the sudden spike in demand which is being experienced around the world. Seen together with global issues such as rising fuel and grain costs, and far from being concerned about dumping, South Africa should instead be bracing for meteoric price increases across the board – which is why so many other countries are lowering their trade duties, he explains.
“South Africa already does not produce enough chicken to meet local needs, and given the soaring base costs of chicken from foreign producers, we believe that the risk of so-called predatory pricing is exceptionally low.”
“We would therefore recommend government heeds industry calls to suspend all import duties and even value-added tax to safeguard local food supply chains and food security.”