October 25, 2012

Brazil questions South Africa's proposed dumping surcharge on chicken

The Brazilian Poultry Association (UBABEF) is questioning the letters sent Monday (Oct.22) by the International Trade Administration Commission of South Africa (ITAC) which discuss application of provisionary dumping surcharges by the South African government on whole chicken and chicken part imports from Brazil.

According to an explanation from the UBABEF President, Francisco Turra, it is likely that this publication will serve as the basis for a final determination by the South African government on whether to apply a definitive measure regarding the dumping investigation. This is why there is significant concern on the part of the Brazilian poultry industry in relation to the result of the document, which indicates that Brazil is practicing dumping.

Turra emphasised that the economic indicators for the South Africa's agricultural poultry industry have not changed, even though the volume of chicken exports from Brazil has been drastically affected.

In February of this year, the South African government applied provisionary dumping surcharges to Brazilian chicken. According to the Government Gazette of South Africa, these measures affected whole and boneless cut chicken exports, with surcharges of 62.93% and 46.59%, respectively. These surcharges are added to regular import tariffs, which are 5% for whole chickens and 27% for boneless cuts.

Since then, UBABEF has been supporting Itamaraty in opening a WTO panel against the decision. UBABEF data show that 160,000 tonnes of chicken were exported to South Africa in 2009. In 2010, this volume was 181,000 tonnes; and in 2011, 195,000 tonnes. Boneless cuts accounted for 10% and whole chickens for 4% of exports in 2010, the year being investigated for dumping.

Until the provisionary dumping measures were applied, South Africa had imported 16% of all of the chicken consumed in the country (70% of this amount came from Brazil). The other 84% came from local producers. The products under investigation for dumping account for 3% of total poultry products on the market.