Fears of jobs bloodbath grow over SA chicken crisis

Cape Town - Poultry producers, especially those in KwaZulu-Natal, are on the brink of closing shop, warned Agriculture Minister Senzeni Zokwana.

He was speaking in Parliament on Wednesday ahead of public hearings on challenges facing the beleaguered poultry industry.

"Most of the companies, especially in KZN are on the verge of being run down," said Zokwana.

"There's been a demand that there should be work done by the department of trade and industry in terms of assisting those farms in distress so we prevent the shedding of jobs."

READ: Chicken wars: SA vows to fight dumping

Zokwana's comments come hot on the heels of Deputy President Cyril Ramaphosa vowing that government will do everything in its power to ensure that there are no factory closures or job losses in the poultry sector.

Major chicken producer RCL Foods, which owns the Rainbow and Farmer Brown chicken brands, warned it would have to let more than 1 300 workers go and shut down various farms in Hammarsdale in KZN owing to unfavourable conditions in the industry.

Government has established two task teams to urgently address the situation within the poultry industry. The first is a government task team, while the second is a broader task team that includes representatives of government, business and labour.

READ: Protectionist policies not enough to save SA poultry

Although the government has moved to tighten regulations, protectionist policies alone will not fix the local industry since it faces pressure from different fronts, agricultural economists told Fin24.

"We seem to be a dumping field for different countries in terms of brown meat (leg quarters and wings)", Zokwana said, adding that it compounds the challenges, such as growing input costs, a lack of soya beans production and high broiler imports, that the local poultry industry is already confronted with.

"I understand that SAPA (SA Poultry Association) and Fawu (Food and Allied Workers Union) have approached cabinet with a view of finding a solution in assisting them to deal with the matter."

Zokwana said discussions with the European Union are taking place to find out why they don't accept South Africa's white meat (the breast), "which can offset what they dump on us".

READ: Stop dumping chicken in SA, urges SAPA

Cosatu will be among those making submissions in Parliament on Thursday.

"With one out of three workers unemployed and jobless minimal economic growth, South Africa simply cannot afford to lose more thousands of jobs, especially for vulnerable farm, food and retail workers," said Cosatu Parliamentary coordinator Matthew Parks in a statement.

"Industry and government need to urgently act to stem this bloodbath before it’s too late."

Among the proposals being pushed by Cosatu are raising import tariffs, quotas and safe guard measures, providing subsidies for farmers on chicken feed, electricity, water, equipment, taxes and transport and a mass buy local chicken campaign.