Town in despair as 1 200 chicken industry workers retrenched
THE small KwaZulu-Natal town of Hammarsdale has become the epicentre of an international trade war between South Africa and the US, with casualties mounting.
On Friday, 1 200 workers from Rainbow Chicken, renamed RCL Foods, who live and work in Hammarsdale were retrenched.
That is set to have a devastating effect on the town, with the company contemplating shutting down further farms.
RCL Foods, one of South Africa’s biggest chicken producers, has, after years of fighting overseas chicken imports, been forced to sell 15 of its 25 Hammarsdale farms just to stay afloat.
Poultry imports for the first half of last year totalled 288 081 tons, with the EU accounting for 45.5% and Brazil contributing 43.2%.
The remainder was mainly imported from the US. Poultry industry insiders warn that for every 10 000 tons of chicken imported, 6 000 jobs could be affected.
Until recently, RCL Foods was the biggest employer in Hammarsdale, providing jobs for nearly 5 000 people after textile industry closures between the mid-1990s and 2002 cost an estimated 40 000 jobs.
Losing her job has become a bitter reality for Sizakele Lebitsa, one of the 1 200 newly retrenched workers.
Lebitsa dreamt of building a home for herself and her children.
“I have five children, with three finished at school but unemployed. I was the only one working,” she said.
“I am renting property and saving money to build a house for my family, but now I won’t be able to do that.”
Lebitsa, who worked at RCL for six years, also supports her late brother’s three children.
RCL Foods managing director Scott Pitman told workers the company had set aside R1-million for their skills development.
“It’s sad to see what’s happening with the poultry industry. It’s sad to break the company down into a smaller business instead of growing up,” he said.
“I want to leave you with some hope. Hopefully, we can fix the chicken industry.”
Wits University School of Economic and Business Sciences head Professor Jannie Rossouw said cheap imports may cause the collapse of the chicken industry in South Africa.
“It’s still early days and the chicken industry is large, so it may adapt to the competition,” Rossouw said.
“But at the moment it’s in a tight spot. Cheaper [imported] chicken benefits consumers, but it is not a sustainable way to feed people.”
Economist Dr Azar Jammine said that, while 1 200 jobs was small fry in the context of unemployment in South Africa, the effect on Hammarsdale would be devastating for the small town.
“It will create huge unemployment in the area and affect migration,” Jammine said.
On previous calls for new trade agreements to protect the chicken industry, Durban Chamber of Commerce and Industry president Zeph Ndlovu said the government needed to intervene urgently to protect the industry and preserve jobs.
“The pronouncement made by [US President Donald] Trump of ‘Americans First’ means we have to review our policy in favour of South Africa,” Ndlovu said.