South African poultry and egg producers grapple with power outages and bird flu

Egg prices rose 19% between September and October 2023 and 36% between October 2022 and October 2023, according to the Pietermaritzburg Economic Justice and Social Dignity Group's October Household Affordability Index . Chicken legs and stomachs rose in price by 8% year on year, chicken liver by 14%. These are the foods that the poor consume the most.

The Association of MEAT Importers and Exporters (AMIE) has warned there will be a significant rise in poultry prices over the festive season and into 2024 due to shortages caused by the avian flu outbreak and the government's "failure to implement import duty rebates in a timely manner," Paul Matthew said , CEO of AMIE.

As reported on MoneyWeb, Deputy President Paul Mashatile promised a package of support to affected farmers a month ago, while Trade, Industry and Competition Minister Ebrahim Patel almost two months ago called for an urgent investigation into the introduction of rebates on poultry imports .

Meanwhile, Mathew said that to address the poultry shortage caused by the bird flu outbreak, the local poultry industry urgently imported 83 million fertilized eggs and airlifted them, which he said was 3 times more expensive than local eggs .

Meanwhile, Izaak Breitenbach, CEO of the South African Poultry Association (SAPA), said AMIE was "very opportunistic in its assumptions", adding that SAPA does not expect any shortages of poultry products this festive season due to bird flu “through rapid and targeted action to prevent the spread of the virus early in the outbreak.”

According to him, due to the culling of diseased flocks, the production of broiler hatching eggs has decreased by about 30%. “Producers have made up the potential 30 percent shortfall by importing enough hatching eggs to make up for any potential shortfall,” he said.

“These quick and decisive actions have already erased the biggest impact on consumer prices. In addition, fertilized hatching eggs are not imported at a price “3 times higher than” locally produced eggs. Although it is a little more expensive, the cost of hatching eggs is washed out and included in the cost of the entire bird,” he said.

“Importing eggs is a much cheaper option than importing whole chickens for that matter, and provides local jobs in the poultry sector while strengthening the country's food security. On the other hand, imported meat is a poor substitute for locally produced poultry, especially now that the ports are overloaded,” he added.

The Commission on International Trade Administration said the investigation process into considering the introduction of temporary discounts on poultry products was ongoing.

Matthew says that while import tariffs subsidize and protect local poultry producers, they are actually a tax that consumers must bear. He said the government's overall mandate was to act in the best interests of the people of South Africa - the consumers.

Import tariffs are “an extremely regressive form of tax,” he said, adding that they have a very direct impact on consumers. He said the 62% import tariff on chicken with bones, introduced in March 2020, was supposed to be a temporary measure but was "institutionalized at the expense of consumers".