Picture: BLOOMBERG/DANIEL ACKER
Picture: BLOOMBERG/DANIEL ACKER

Reading Mike Schussler’s article, and the response of Francois Baird from FairPlay, it’s clear to me that there’s a poultry price war between Brazil and SA and winning is seen as more important than a fair fight.

It is a common strategy when two entities are in a price war that the bigger one will price the other one out of the market. You will lower your price and make little or no margin on your product until the opponent is dead ... and then you can charge what you want. Presumably this is what Brazil is doing here. If Schussler’s findings are true, and imports are evading the tariffs that are due, our authorities have to act. SA’s chicken producers play by the rules, but we cannot compete if the playing field is not level.

We know that Brazil makes money on the white breast meat they export to the West, and that they are then left with the rest of those chickens, and we know that SA is a target for those leftovers. They are price takers, because they’ve made their margins, they just want to get rid of the brown meat portions. And it is not just here — Namibia and other African countries also have  massive problems with Brazilian chicken.

In Ghana, Brazil has already won the price war and now there is no domestic poultry industry to speak of, and presumably Brazil can now charge whatever they want for chicken. So we must not be fooled by low prices charged to SA for now. In my opinion that will change as soon as Brazil wins the price war and destroys our chicken industry. That is why we should be smarter, and support our own poultry industry, the way Brazil supports theirs.

For the sake of poultry farmers like myself — and SA consumers who will pay the price in the end when chicken prices are dictated by other countries — I hope the SA Revenue Service and minister Ebrahim Patel are taking notice.

Clive Tigere, Louis Trichardt

JOIN THE DISCUSSION: Send us an e-mail with your comments. Letters of more than 300 words will be edited for length. Send your letter by e-mail to letters@businesslive.co.za. Anonymous correspondence will not be published. Writers should include a daytime telephone number.

subscribe

Would you like to comment on this article or view other readers' comments?
Register (it’s quick and free) or sign in now.

Speech Bubbles

Please read our Comment Policy before commenting.