South Africa’s poultry industry says it is on the brink of collapse due to hotly-denied accusations that the European Union is dumping cheap chicken in the country in a dispute over free trade.
About 500 workers, former workers and company managers from the South African poultry sector marched on the EU headquarters in Pretoria on Wednesday, furious over cheap imports and mounting job losses.
But the EU has accused the industry of using it as a “handy scapegoat” for domestic production problems, and said volumes of EU chicken imports were too small to be responsible for the crisis.
Organisers of the march said that 4,000-5,000 jobs had already been lost, and that 110,000 more were at risk in the industry, plus 20,000 in the feed supply sector.
“Organize or starve,” said one banner at the protest. “Dumping destroys SA jobs,” said another.
RCL Foods, South Africa’s largest poultry producer, last month laid off 1,350 employees — 20 percent of its workforce — and is selling 15 of its 25 farms.
“This issue has been growing since the EU started to send more and more leg quarters to South Africa at what we consider dumped prices,” RCL Foods managing director Scott Pitman, who was on the march said.
“Not only have we taken a financial burden over the last five years, but the loss has got so big that we are going to go bankrupt if we don’t cut the size of our business.”
The South African poultry industry alleges that the EU dumps off-cuts of “dark meat” – chicken thighs and drumsticks – in South Africa at below-cost prices because the European market prefers breast meat.
“This is a form of waste disposal,” Kevin Lovell, the boss of the South African Poultry Association (SAPA) told AFP.
South Africa is struggling with slow growth at just 0.4 per cent last year and unemployment is stuck stubbornly high at 27 per cent – posing a major challenge to the ANC government.
On Monday, ANC secretary-general Gwede Mantashe suggested the government should intervene by buying poultry farms that are closing down and finding new markets for their produce.
In the face of damaging accusations of dumping, the European Union has fought back, saying the South African poultry industry was blaming others for its own failures.
“When people are losing livelihoods, trade deals can be a handy scapegoat,” EU Ambassador Marco Cornaro told reporters on Tuesday.