According to BusinessDay, industry players say that even this won’t suffice to help local poultry producers, industry players say.

The biggest challenge facing the local industry is overcapacity, says Faure Heymans, analyst at asset manager RE:CM. Because of the very low entry barriers in the poultry market, growth in supply has outstripped growth in demand for chickens.

Health and safety restrictions on exports make finding new markets for South African chicken almost impossible.

This oversupply, coupled with restrictions on finding new markets, has led to pressure on retail prices, says Mr Heymans. There also isn’t much room to expand the domestic market, as South Africans are among the biggest consumers of chicken: the average person eats 37kg a year.

The US is the biggest consumer: the average American eats 40kg of chicken a year.

What doesn’t helped South African poultry producers is the mighty bargaining power of the supermarket chains.

"The big three — Shoprite, Spar and Pick n Pay — set the tone with prices. Chicken is such a commoditised product that it is hard to differentiate into higher-end products.

"Supermarkets often use it as a loss leader — selling it at a loss in order to get feet through the door," Mr Heymans said.

What makes it more difficult is that the cost of feed, which contributes an estimated 65 per cent of the cost of producing a live chicken, has been rising.

What the local producers should do is cut their output, but it is a classic prisoner’s dilemma, Mr Heymans said. Any big producer scaling back output will be the loser, as others will simply keep their production intact and make more money from their volumes.

So nobody is willing to make the first cut and instead, the focus has shifted to importers.

"Instead of scaling back production, producers are targeting importers. If you look around the world, chicken producers do benefit from a lot of protection and support.

"The new tariffs will slow down imports, but I don’t see anything changing unless local producers start cutting back output or find new markets.

"Given the challenges around exports, they really have no alternative but to cut production," Mr Heymans said.

Another problem is that chicken imports are relatively small.

An analysis of the import data shows that while import volumes of whole chicken, offal, carcasses, bone-in portions and boneless cuts grew 74 per cent between 2010 and 2012, their market share remains tiny.

Statistics from the International Trade Administration Commission shows local producers’ market share in the Southern African Customs Union, which includes Namibia, Lesotho, Swaziland and Botswana, declined from 91 per cent in 2010 to 89 per cent last year.

Kevin Lovell, CEO of the South African Poultry Association, said the higher tariffs announced this week would not alone be sufficient to help the sector.

Ways should also be found to stem unfair imports from the European Union, address feed costs, and grow demand for chicken through creating more jobs, he said.