by MTHULISI SIBANDA
JOHANNESBURG – FEATHERS are flying over the increasing presence of Brazilian chicken in South Africa.
While there is agreement this is to the detriment of the poultry industry locally, some divisions prevail as some economists argue South Africa was “lucky” and getting a “fantastic” offer from the South American country.
Industry executive have warned this was a misrepresentation of facts and figures.
Independent economist, Mike Schussler, in an opinion attributed to him in a daily publication, stated, “If we follow the prices and flows of Brazilian chicken from Brazil at the four-digit level and then compare the numbers reported by importing countries, we will notice that SA is either getting the deal of a lifetime or is being sold a lie.”
He added overall, Brazilian chicken exported to SA cost less than half the average Brazilian global chicken export price.
“In fact, Brazil loves SA so much that in the two years to mid-2020 we paid an average of just R9,72/kg for frozen chicken across all categories, compared to the average price of Brazilian global exports of chicken meat of R22,70/kg.”
Schussler calculated that in the two years to April 2020 whole frozen birds for export to South Africa cost R16,30/kg as they were loaded in Brazil, compared to the world average for Brazilian frozen whole bird of R20,10/kg.
Over the same two-year period, he wrote, the Brazilian farm gate price for whole chicken was R16/kg.
“How lucky of SA to get such impressive discounts,” the economist added.
“So Brazilian chicken producers made next to no profit on frozen whole chicken exports to SA. In summary, SA gets a fantastic deal from Brazil, probably at the expense of our local industry and jobs.”
Paul Matthew, Chief Executive Officer of the Association of Meat Importers and Exporters (AMIE), while agreeing the flurry of Brazilian chicken was detrimental to the local industry, vastly disagreed with Schussler’s analysis.
“Whilst the (Schussler’s) statement points in the right direction, the subsequent analysis offered to contextualise the Brazilian imported chicken-related products into South Africa is wholly misguided — or simply reflects ignorance of the subject matter,” Matthew said.
He said the analysis the above-mentioned analysis of prices was misinformed.
“This calculation is completely misleading.”
According to Matthew, the average unitary export value of the ‘whole frozen bird’ was R17,55/kg over the period April 2018 to April 2020.
The equivalent value in South Africa was R17,89/kg, less than the article’s R6,69/kg.
“The article introduces another potentially misleading factor in comparing values in Rands over such a large span of time,” Matthew said.
“It is no wonder that the economist nearly drowned in the ocean of his own questionable analysis. There are various other inaccuracies contained in the article – making us wonder as to the real objective of this article.”
There have been calls on government to ban so-called dumped chicken imports from Brazil in order to save domestic poultry producers.
– CAJ News
