LETTER: Puzzled by poultry inquiry
Growth-inhibiting issue in the industry needs to be addressed first
The SA poultry industry has had a profoundly challenging couple of years, having to operate in an environment of failing municipalities, power cut issues, rising imports, higher feed prices and avian influenza, among other things.
As an industry that accounts for a considerable share of the SA agricultural economy and a vital source of protein, one would imagine that the broader national effort would be aimed at helping support its recovery.
Indeed, the SA government has supported the industry over the years through trade policy. The International Trade Administration Commission (Itac) of SA has played a pivotal role in cushioning the poultry industry against unfair competition or the dumping of poultry products. The government also launched a Poultry Sector Master Plan in 2019 to boost inclusive growth in this industry.
The Covid-19 pandemic and growth-constraining factors highlighted above are some aspects that have slowed the implementation of the master plan, as the industry has had to operate almost in “crisis” mode. And the challenges that constrain inclusive growth in the industry persist. The associated costs of these broad problems also limit the participation of small players. This means if we care about inclusive growth in the poultry industry, we should focus on resolving issues of failing municipalities, power cuts and biosecurity, among other things.
We are therefore puzzled by the idea that there is a Competition Commission inquiry into the poultry industry now, while the factors distorting progress in the industry remain unresolved (“Poultry sector inquiry is ‘an attack’, says Astral CEO Chris Schutte”, February 9). We should first resolve these growth-inhibiting issues, assess whether the pace of inclusion of small players still won’t take off, and only then consider whether an inquiry is warranted.
Wandile Sihlobo and Prof Johann Kirsten
Stellenbosch University agricultural economics department
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