LETTER: Poultry importers late in joining antidumping fight

Eureka! Poultry importers in SA have woken from their hibernation. Where have they been while our industry has been hammered  by a rampant International Trade Administration Commission (Itac), obviously spurred on by the country’s trade ministry, in their response to a dumping duty application by local poultry?

Yes, another application aimed at increasing chicken prices via the tariff route, to the detriment of long-suffering consumers. Weeks ago Itac imposed high provisional dumping duties on our poultry imports from Brazil and four EU countries. It must conclude their investigations by June 14, after which final duties may well differ in quantum from the current ones. This comes just over a year since the locals won a major battle in securing substantially higher customs duties, with importers again mysteriously missing in action.

The current action was launched just short of 12 months ago. During this time local poultry, through its PR agents, again launched a nonstop media campaign attacking imports and importers with gusto. Some of the criticism was fair, and some not, but if you want to challenge you need to put your head above the parapet.

This well co-ordinated campaign dominated the media and would certainly have helped mould views of decisionmakers in the government and the public. Yet, importers were nowhere to be seen, with the exception of a few outgunned individuals. Now, with the stable doors already ajar, they have risen from their deep slumber in a state of shock.

Why? What were they expecting? The Association of Meat Importers & Exporters (AMIE) made some good points in its letter, but too late I fear (“Poultry tariffs hide failings”, January 25). The original dumping application was flawed in that it just didn't comply with the country’s antidumping regulations, as there is no clear evidence of either dumping injury or even threats of any future dumping injury. Without either of these there are no grounds to proceed.

Itac is clearly rewriting its own rule book. The woes of local poultry were in reality caused in the main by high feed costs, Covid-19 and lockdown damages, and a battered economy. They said this themselves at the time, but Itac was looking the other way.

AMIE CEO Paul Matthew went on a bit of a rant about structural impediments which, if addressed, would make the SA poultry industry “more efficient”, and also about the lack of implementation of the poultry master plan, especially the failure to grow exports. I find it hard to believe the naivety, like chickens rushing to the slaughter house.

Incredibly, the AMIE signed the poultry master plan, whose stated main aim is to increase the market share of local poultry. Yes, you read that correctly. It willingly signed a document that is a huge threat to its own members. Does nobody hear the clear ongoing localisation messages emanating from trade, industry & competition minister Ebrahim Patel and his cohorts? By its very nature a localisation plan means import reduction.

Export growth is part of the master plan, but it is not going to happen in a meaningful way. Why would SA poultry take on the extremely difficult, frustrating and costly job of exporting its products, combined with the serious logistical issues related to our shambolic road, rail and port facilities? To top it all, meeting strict compliance standards would likely be a long, arduous and arguably unsuccessful exercise. It is far easier, with no risk, to gobble up a big slice of the import market, with help from government. And that is exactly what the local industry is wisely doing.

Underestimating the efficiency of mainly well-run local poultry companies can be fatal. Hard-pressed consumers simply cannot afford big price increases in a product as basic as chicken.  However, the devastating preliminary ruling is a clear indication of localisation in action.

Francois Baird of Fairplay clearly places  jobs in the centre of the ongoing dispute (“Importing joblessness”, January 27). He, of course, has picked up the contradictory messages importers are sending out surrounding their commitment to the master plan they signed. Baird makes some good points, but here’s another: local poultry made it clear in their own application that alleged dumping has prevented them from increasing prices. It follows that now that very high provisional dumping duties are in place, chicken prices will again rise.

There is ample economic research clearly proving that such increases on a basic essential product will cost SA far more jobs in the wider economy than the direct job losses from imports, as claimed by Baird. He also refers to R1bn spent to create 1,300 jobs. The recent financial reports of major local poultry companies reflect only a handful of new jobs created. It’s there in black and white.

The problem, as I see it, is that with all their talk nobody really cares about the consumer — not the minister, local poultry producers nor the importers. Let the poor, the unemployed, the desperate and the less fortunate who can barely afford to feed their families, all eat cake.

Hans Friedrich
Sandton

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