The South African Poultry Association (Sapa) has filed a lawsuit seeking to force the government to suspend a quota that excludes some US poultry imports from an anti-dumping tariff.
While media reports from publications such as Reuters have stated that the lawsuit was in direct response to the steel and aluminium tariffs imposed by the Trump administration this year, Marthinus Stander, CEO of Country Bird Holdings and Sapa broiler organisation chairperson, told FTW that it was a bit more nuanced than that.
He said it was not retaliatory but rather in accordance with the agreement struck with the US during the 2015 renewal process of the African Growth and Opportunity Act (Agoa).
“During the Agoa renewal process, the poultry industry agreed to negotiate a quota of US poultry imports that would be exempt from antidumping tariffs, despite the industry not benefiting at all from Agoa access. The US practically bullied us into it in order for them to gain access to our market and for us to make sure our other industries could benefit from Agoa access,” said Stander. “However, the gazette that gave effect to this agreement clearly stated that this quota would remain in place for as long as the benefits to our other industries continued to accrue.”
Stander noted that the domestic industry was experiencing significant volumes of dumping, especially as the US was exporting its chicken-on-the-bone – which all South Africans love – at below cost price.
This, along with other challenges faced by the industry, including issues with import tariffs, free trade agreements, mislabelling of packaging and the avian influenza outbreak in 2017, has left the South African poultry industry in a troubling state.
He said the industry had not taken this drastic approach, in the form of a lawsuit, lightly but had first approached the Minister of Trade and Industry, Rob Davies, to revoke the quota which he is allowed to do. “We did not hear back from Davies, so we decided to take the legal route,” said Stander.
“This is not about starting a trade war, this is only about following the letter and spirit of the agreement reached with the US and ensuring that we take steps that are beneficial to local industry. “For every 10 000 tons of poultry we produce we can create 1 000 jobs. The quota agreement with the US allows for 65 000 tons to be imported anti-dumping tariff free into the country – that’s 6 500 jobs. We’d rather have the jobs.”
Association of Meat Importers and Exporters of South Africa CEO, David Wolpert, told Reuters that he believed this lawsuit would provoke retaliatory action from the US poultry industry.
“We will certainly be encouraging our government to take appropriate action,” James Sumner, president of the USA Poultry and Egg Export Council, told Reuters. “We hope that the US and South Africa will amicably resolve the differences they have over the (steel and aluminium) tariffs but it should not interfere with agreements already reached on poultry trade.”
