Consumers to pay more for chicken

2013-09-30 13:10

Multimedia   ·   User Galleries   ·   News in Pictures Send us your pictures  ·  Send us your stories

Putting a whole roast chicken on the dinner table is likely to cost consumers a bit more in future, Trade and Industry Minister Rob Davies has said.

Davies raised the poultry import tariffs by an average 8.75 percent, saying the higher duties were necessary to raise local production and save jobs in the industry.

“The roast chickens you will have at your dinner table, you can now pay a little bit more and you can all help ensure that there’s job creation in South Africa,” Davies said today.

While the tariff duties for whole chickens rose from 27 percent to the maximum 82 percent allowed under World Trade Organisation rules, increases for other categories of chicken -- specifically those usually consumed by lower income households -- were much lower.

“Bone-in portions, these are for lower income segments... it’s about 70 percent of domestic production and the industry is at a significant price disadvantage,” Davies said.

“The import tariff is changed from a specific duty of 220 cents per kg to an ad valorem duty of 37 percent.”

This meant the import rate had changed from around 17 percent to 37 percent for bone-in chicken.

These white meat cuts represented around 54 percent of total poultry imports over the past year.

“In respect of carcasses... the conclusion was that the domestic industry is at a significant price disadvantage, but this remains a significant source of protein to lower income people and here the tariff is increased slightly from 27 percent to 31 percent,” Davies said.

Carcass imports represented about two percent of the total poultry imports over the past year.

Import duties for offal were also slightly increased from 27 percent to 31 percent.

“Offal -- the domestic industry is at a significant price disadvantage but this is an important source of protein to poor households,” said Davies.

The most expensive cut – boneless chicken – represented around 11 percent of imports over the past year.

“What we call boneless cuts... mostly consumed by higher income households... this we’ve seen [local producers] is also at a price disadvantage and the tariffs increased from five to 12 percent.”

Explaining his decision, Davies said the local industry was “bleeding” and increasing tariffs were necessary as “tools of industrial development“.

“This is not here to raise revenue for the state, this is here to increase production in South Africa,” he explained.

Davies said he believed the increases struck the right balance between restricting the price-raising effects on poor households and ensuring domestic producers became more competitive compared to their foreign counterparts.

One of the conditions attached to the tariff increases was an early review -- possibly in one year -- to check whether it had the intended impact on local producers.

The department would also monitor prices and developments in the industry to guard against the increases being used for anti-competitive practices.

Davies’s decision followed an application by the SA Poultry Association (SAPA) to the International Trade Administration Commission (ITAC) to increase the tariffs in March this year.

The ITAC made its recommendation to Davies last month, after consultation with stakeholders including the SAPA and chicken importers.

The tariff increases are effective immediately.

Join the conversation!

24.com encourages commentary submitted via MyNews24. Contributions of 200 words or more will be considered for publication.

We reserve editorial discretion to decide what will be published.
Read our comments policy for guidelines on contributions.

24.com publishes all comments posted on articles provided that they adhere to our Comments Policy. Should you wish to report a comment for editorial review, please do so by clicking the 'Report Comment' button to the right of each comment.

Comment on this story
0 comments
Comments have been closed for this article.

Inside News24

 
/News

Book flights

Compare, Book, Fly

Traffic Alerts
There are new stories on the homepage. Click here to see them.
 
English
Afrikaans
isiZulu

Hello 

Create Profile

Creating your profile will enable you to submit photos and stories to get published on News24.


Please provide a username for your profile page:

This username must be unique, cannot be edited and will be used in the URL to your profile page across the entire 24.com network.

Settings

Location Settings

News24 allows you to edit the display of certain components based on a location. If you wish to personalise the page based on your preferences, please select a location for each component and click "Submit" in order for the changes to take affect.




Facebook Sign-In

Hi News addict,

Join the News24 Community to be involved in breaking the news.

Log in with Facebook to comment and personalise news, weather and listings.