Greed fuels poultry wars

I have been following the “chicken wars” in the media for what feels like years. The plot seemingly never changes: a self-proclaimed efficient local industry cannot compete with allegedly dumped cheap imports and so applies for tariff relief from the government. While the application is considered, a “war” breaks out between the opposing parties.

Then the government approves a tariff increase, the details of which seem to satisfy nobody. Months later, we read of a new tariffincrease application and the entire merry-goround starts again.

This time the authorities have adopted a different stance, and all sides are sitting around the table discussing some type of poultry master plan for SA. Included in this is a negotiation that will include an agreement on increased tariffs, a concerted export drive, industry transformation and some vague aim for a harmonious future for all in this game.

It sounds wonderful, but in truth these noble aims don’t seem achievable, and it’s an odds-on bet that the warring parties will soon be beating the drums again. The harsh truth is that there is good money to be made in an industry that supplies huge amounts of essential protein to millions of South Africans, and simple greed drives many of these clashes.

Local poultry makes huge returns, but the industry operates under a cloud of volatility because of sharp movements in feed prices. Importers work on lower margins but huge volumes off a lower fixed-cost base.

So the battle over the chicken bone is never ending, with feathers always flying. There should, however, be some non-negotiables: price and consumer affordability, job retention and product quality, whether local or imported. The bottom line is that all parties must sacrifice a little so the industry can grow in the interest of all, especially our hard-pressed consumers.

Dennis Wilson Morningside