New chicken imports tariffs will hit the poor hard

The newly increased tariffs on chicken imports will threaten South Africa’s food security, according to the Emerging Black Importers and Exporters Association of South Africa and the Animal Protein Association of Brazil.

The new tariffs, which were approved by Deputy Minister of Finance David Masondo, increased from 37% to 62% on frozen bone-in chicken portions (a 25% increase) and from 12% to 42% (a 30% increase) on frozen boneless portions.

“The country is officially in recession, and consumers and small business owners need all the help they can get. Why ramp up the tariff so substantially?

“The evidence is clear – these tariff increases will lead to price increases for consumers,” said Emerging Black Importers and Exporters Association of SA chair Unati Speirs.

She said tariff increases would hurt many black poultry importers who were trying to build businesses and already operated at a disadvantage because of the large poultry importers and the local poultry industry.

“Many of these businesses are already marginal, and this is likely to mean some of our members simply have to shut up shop, depriving people of jobs and an income,” said Speirs.

She said chicken was the largest and most affordable source of protein in SA, but local producers had not expanded production.

“This is the seventh time that the local industry has applied for protection since 2011. In 2013, import tariffs on whole chicken increased from 27% to 82%, frozen bone-in chicken increased from 18% to 37% and frozen boneless cuts from 5% to 12%,” Speirs noted.

Ricardo Santin, executive president of the Animal Protein Association of Brazil, said in SA the biggest losers would probably be the low-income population, who would have to pay more for a product with less supply.

“South Africa has always counted on the support of external suppliers to balance the supply of chicken meat to its population, and the increased tariff puts this balance at risk,” he said.

Santin said the SA poultry industry could only produce enough chicken to meet 70% of local demand, and 30% had to be imported. “Poor households spend 34% of their budget on food, and of the meat consumed, 59% is chicken, so increasing import tariffs can bring significant social consequences.”

– gcinan@citizen.co.za

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