The Department of Trade and Industry’s (DTI’s) action-focused government task team is in the process of identifying several interventions to resolve the current crisis surrounding poultry product dumping in South Africa’s market.

The department is seeking out measures to boost trade, competitiveness, value-addition and technology upgrades; provide export support, industrial finance and incentives; and promote growth and transformation of the poultry industry, besides others.

“Government, through the establishment of the action-focused government task team, has taken the support for the sector to another level through the structured mechanism. This team will develop a common response to the complex challenges facing the domestic industry,” DTI industrial development deputy director-general Garth Strachan said this week.

This followed the delivery this week by Food and Allied Workers Union (Fawu) general secretary Katishi Masomela and South African Poultry Association CEO Kevin Lovell, on behalf of the poultry industry, of a memorandum of protest to the European Union’s (EU’s) offices in Pretoria over the claimed dumping of chicken in South Africa.

The memorandum claimed that dumped chicken pieces from EU countries, said to account for 80% of chicken pieces imported into South Africa, are the primary cause of the local industry’s woes and that “thousands more jobs could be lost this year if dumping continued unabated”.

Around 1 350 jobs were lost recently at the RCL Foods chicken plant, in Hammarsdale, KwaZulu-Natal, where operations were halved from two shifts to one.

“There is a huge surplus of chicken leg quarters in the EU because consumers there prefer chicken breasts and wings. The brown meat is disposed of as off-cuts, often labelled waste, to any market that will take it at any price the producers can get,” it said, adding that, with markets such as Russia and China closed to EU imports, producers have focused on South Africa, where “barriers are minimal”.

The South African chicken industry also hit back at comments by European Commission trade commissioner Cecilia Malmström that the “real problem” in the South African chicken industry was not EU imports but structural problems affecting its competitiveness.

“The South African industry is modern, efficient and well able to compete effectively against fair competition. We are not only among the most efficient chicken producers worldwide, but we produce chicken at far lower cost than EU countries.

“But no market, however efficient, can compete against dumping. If tariffs are raised, prices will be lowered to get rid of the frozen surplus,” RCL executive Scott Pitman said, outlining the contents of the memorandum to EU delegation to South Africa head of trade and economics Massimo de Luca.

The DTI noted that while there are US imports of chickens entering South Africa, as agreed through the African Growth and Opportunity Act, these are not the source of the present crisis of the poultry industry, as the US is not fully using its 65 000 t/y quota optimally.

The Select Committee on Trade and International Relations on Thursday also urged the DTI to “speedily” deal with the challenges facing the poultry industry.

“Many poor households consume chicken as a staple food and any threat to the production of chicken meat poses a serious threat to the health and welfare of indigent South Africans.

“Also, when jobs are threatened, it is imperative for the government to intervene using creative and innovative protective measures, mindful of our international obligations,” committee chairperson Eddie Makue commented.

The committee further called on the South African poultry industry to also ensure the “rapid transformation and industrialisation” of the sector, stating that the price of chicken products in South Africa is exorbitant, opening the market to more affordable imports.

“The [DTI] task team will receive inputs and undertake research where required; identify possible areas for intervention; engage with different stakeholders; make recommendations for intervention; and unblock areas for intervention,” Strachan noted.