February 16, 2024
South African poultry industry challenges threaten closure for 20% of local producers
Kobedi Pilane, CEO of African Poultry Producer, anticipates that approximately 20% of South African chicken producers may shut down due to the compounded challenges of load shedding and anticompetitive practices in the industry, The Citizen reported.
Pilane's comments come in the wake of the country's Competition Commission's announcement of a market inquiry into the chicken industry value chain, citing concerns about potential barriers to competition within the market.
Since the bird flu outbreak last October, the chicken industry in the country has faced significant strain, resulting in the culling of millions of birds and a consequent 30% reduction in hatching egg production.
Combined with challenges like load shedding and escalating costs of importing chicken feed due to global conflicts, such as the war in Ukraine, local chicken producers are grappling with mounting pressures.
Emerging farmers in the industry are reportedly encountering various obstacles that hinder their progress, further exacerbating the situation.
Pilane said that the industry has long been dominated by major players, hindering smaller participants.
The Competition Commission has called for written submissions on the proposed Terms of Reference (ToRs) for the Poultry Market Inquiry, intending to examine the participation of small and medium enterprises and historically disadvantaged persons in the industry value chain.
Chief economist James Hodge highlighted the significance of the inquiry, noting that the outcomes in the poultry industry are crucial for many South Africans, particularly those from low-income households, as chicken meat and eggs are essential protein sources.
- The Citizen
