Poultry industry is efficient - experts

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In January, the EU, which has been accused of dumping brown chicken meat in SA, suggested local poultry producers suffered from structural problems that hampered its competitiveness.

Speaking at Astral's annual general meeting on Thursday, CEO Chris Schutte said "solid, independent" research from the Wageningen University in the Netherlands showed the local poultry industry produced a whole bird between 10% and 29% cheaper than European countries - despite the high maize price over the past three years.

"This is enough proof to say classic dumping does exist in SA, because European countries are selling their product here at below production cost," Schutte said. He pointed out that three years ago it cost European poultry producers about R26/kg to produce a bird. "It could now be as high as R32/kg. Now they are selling leg quarters in SA for R15/kg."

He also dismissed the suggestion that the local poultry segment suffered from structural problems. The EU "keep talking about structural issues - they are the people with structural problems. They can't use the whole bird, but we use the whole bird - head, feet, oil, fat and even feathers."

Schutte said research had shown that over the longer term South African poultry producers were ranked in the top 5% of producers in terms of efficiency. "We outperform America, we outperform Europe and are only slightly behind South American countries like Chile and Brazil."

Schutte believed the local poultry industry could expect more support from the government (which recently raised duties on European poultry imports to 13.9%) in terms of combating the dumping of chicken pieces. Recent conversations with cabinet members showed the government was fully aware of the South African Poultry Association, he said. "Without trying to suggest what action government could take, all I can say is that they are concerned and they will give some assistance to the local poultry industry."

Source: Business Day