June 13, 2022

 

South African poultry master plan stalled due to conflict between producers and importers

 


The South African poultry master plan signed by the domestic industry in 2019 to level the playing field and chart a growth path appears to have stalled, with little progress due to a conflict between producers and importers, IOL reported.

 

According to the research group ChickenFacts, the master plan's progress has been uneven, owing to the COVID-19 pandemic, its accompanying lockdown, economic uncertainty, climate change, which has manifested itself in floods and drought, and periodic outbreaks of avian influenza.

 

The group said there has been criticism that the master plan does not address many structural problems in the industry, and that certain signatories have made no progress at all.

 

With an overall deadline of 2023, ChickenFacts looked at how far the master plan has progressed in the 1,000 days since it was signed at South African President Cyril Ramaphosa's 2019 investment conference.

 

It identified a number of missed targets, including export opportunities, which were lost due to a lack of progress in opening new export markets, and exacerbated further by avian flu outbreaks.

 

South Africa's health standards remain insufficient for export to countries like the EU.

 

The group also said that the African Farmers Association of South Africa (AFASA) had withdrawn from the Poultry Master Plan, claiming that no progress had been made in terms of empowerment or ownership, and that it had been drafted without the participation of emerging farmers. AFASA said it didn't go far enough in terms of addressing ownership and empowerment.

 

ChickenFacts said that AFASA had developed its own master plan and was currently working with the South African Department of Agriculture, Land Reform, and Rural Development to amend certain aspects of it before agreeing to participate.

 

AFASA cited the master plan as a tool for stifling imports, which it claimed fell from 20% of the market to 9% of the industry as a result of punitive import tariffs.

 

The International Trade Advisory Commission (ITAC) began an investigation into dumping in June 2022, with the results expected in June 2023.

 

Thalukanyo Nangammbi, an ITAC spokesperson, said when the investigation is complete, all interested parties will be notified through a notice that published in the Government Gazette.

 

Meanwhile, the latest chicken business dispute revolves about export potential and the price of chicken's trajectory.

 

The Poultry Master Plan recognised five major difficulties in the poultry business: feed costs, scale of production, segmentation of production (carcass balance), South Africa's restricted export capacity, and industry transformation.

 

The plan outlined five broad objectives to address these issues: expand domestic maize and soya production; increase production across all aspects of the value chain by 10%; expand industrial-scale food processing; increase exports to 3-5% of local production; and increase black ownership and participation across the entire value chain.

 

The Association of Meat Importers and Exporters (AMIE) has sparked outrage among local producers after announcing a dedicated export task force to flesh out opportunities in the export market and provide processing capacity for cooked poultry products, which is especially desirable in the European Union.


Paul Matthew, CEO of AMIE, said the team had a list of problems that the country and its poultry business needed to address immediately. He said this included gaining access to countries with which South Africa had preferential trade agreements, complying with international health and safety standards and requirements of countries to which South Africa would export, and reorienting local producers' operations to extract value from certain commodities.

 

FairPlay, a research group affiliated with the South African Poultry Association (SAPA), dismissed AMIE's initiative, pointing out that one of the biggest barriers to South Africa becoming a significant poultry exporter is a lack of state veterinary laboratories and infrastructure, which is expected to cost at least ZAR 330 million (~US$20.5 million; ZAR 10 = US$0.62), if not more.

 

-      IOL

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