September 10, 2003



South African Broiler Production Seen At 790,000 Tons


South Africa's broiler production is still growing with about 760,000 tons produced in 2002 and 790,000 tons expected in 2003, according to information from the U.S. Department of Agriculture's Foreign Agricultural Service web site, dated Sept. 3 and released Tuesday.


Executive Summary


South Africa produced about 760,000 tons of broiler meat, excluding offal, in 2002, up from 730,000 tons in 2001. Expectations are that 2003 production will reach about 790,000 tons. The industry is thus still showing healthy growth in spite of a lackluster economy. Poultry meat imports amounted to 24,000 tons in 2002, up from 17,000 tons in 2001.


Total poultry product imports amounted to more than 80,000 tons of which 70% consisted of offal (mainly feet) and Mechanically Removed Meat (MRM). Brazil supplied more than 56% of total imports. In spite of the high percentage by-products in the total import mix, the local poultry producers have applied for additional anti-dumping duties on imports. This application is still being investigated by the new International Trade Administration Commission (ITAC).


Young Chicken Mean Production


In June 2003 the South African poultry producers launched an anti-dumping tariff application. Obviously accurate data is needed to appraise the supply and demand situation and assess any damage to the local industry caused by imports.


As there are no official figures for broiler production, this was enough to start a production data debate. Taking the figures being bandied around into consideration, 2002 broiler production is estimated at 760,000 tons, about 4% more than the 730,000 tons produced in 2001. This amounts to about 575.8 million birds at 1.32 kg. we, or a little over 11 million per week. Indications are that 2003 production is showing similar growth to reach a total of about 790,000 tons and growth then slowing down to about 2% for 2004 reaching 805,000 tons. The 1.32 kg. carcass weight used excludes giblets.




Young chicken meat consumption is estimated at 755,000 tons for 2002, compared to the 790,000 tons estimated in the previous USDA annual report. The previous estimate included offal and mechanical removed meat (MRM). The offal picture is skewed by big imports of chicken feet, which could hardly be included with whole birds or high quality cuts. MRM is not sold in the retail market.


It is the decline and/or slow increase in domestic prices which is claimed to be caused by the imports which has accelerated this year, the press release said.




As a result of the furore created by the anti dumping duty on American bone-in portions (Tariff # 0207.1490) and the recent application for further tariff protection for the local industry, the trade situation needs highlighting.


The problem lays with the definition of chicken meat. When offal and Mechanically Removed Meat (MRM) is excluded from 2002 imports, only 23,788 tons of chicken meat was imported. Total poultry product imports amounted to 80,434 tons, meat amounted to 23,788 tons or 30% of the total, offal amounted to 19,516 tons or 24% and MRM to 37,130 tons or 46%. Offal and MRM together amounted to 46,646 tons or 70% of imports. Offal imports consists of feet, skins, liver, necks, hearts and stomach, (chicken heads may not be imported),

of which 65% was chicken feet.


Mechanically Deboned Meat (MDM) or Mechanically Removed Meat (MRM), is meat and fat extracted from deboned chicken and turkey carcasses by the use of hydraulic presses. It is not sold in the retail market and is only used in the production of processed and canned meat products. Chicken skins are also mainly used in processing. In theory offal and MRM (mainly by products) should thus be excluded from broiler meat imports, but could, for clarity, be included in total poultry imports.




In July 2000 a provisional payment in relation to an anti-dumping duty was instituted against U.S. poultry products. The duty on tariff # 0207.1490 bone- in cuts amounted to R2.24/kg. on products from Tyson Foods, R2.45 c/kg. on products from Gold Kist Inc. and R7.25/kg. on products from other manufacturers. This was promulgated in December 2000 and is still applicable.


In June 2003 the South African poultry producers launched another anti- dumping application. The request is for an increase in the duty on whole birds (0207.12) from 27% to 40% and on bone-in chicken portions (0207.1490) from R2.20 to R4.40/kg. In addition, a new duty on offal (0207.1420) of R2.20/kg. is requested. The duty application is for product from all sources and not only the US. The application is still being investigated by the new International Trade Administration Commission (ITAC), which replaced the former Board on Tariffs and Trade (BTT).


Source: USDA