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USDA International Egg and Poultry


27 August 2014

USDA International Egg and Poultry - South Africa - 27 August 2014USDA International Egg and Poultry - South Africa - 27 August 2014


USDA International Egg and Poultry

South Africa Tariffs and Anti-Dumping Duties

In September 2013, the South African International Trade Administration Commission (ITAC) increased import duties on five poultry products.The South African Poultry Producers Association (SAPA) had submitted an application to ITAC in March 2013 requesting an increase in the rates of custom duty on frozen chicken meat. SAPA made three claims: the survival of the local chicken industry was at risk, jobs would be lost due to reduced demand for domestic product, and concerns about food security.

EU poultry enters the country duty free due to its Free Trade Agreement, and the new higher tariffs on other nations’ poultry began to reshuffle imports away from Brazil and towards the European Union. After South Africa raised tariffs against all non-EU countries, the Netherlands overtook Brazil as the largest poultry exporter by value to South Africa; Brazil remained the top exporter by quantity but exports were trending lower monthly.

UK and the Netherlands’ monthly poultry exports to South Africa doubled in quantity since the new tariffs were imposed against other exporters. Germany’s monthly poultry exports were up 50% in November 2013 compared to October 2013. 

On July 4, 2014 the SARS posted anti-dumping duties (ADD) on HS 0207.14.90 “frozen chicken, cut in pieces” from Germany (73.33%), the Netherlands (22.81%) and the United Kingdom (22.03%). There are exceptions; in Germany several companies have a provisional payment of 31.30% and in the Netherlands Frisia Foods B.V. was excluded from the payments.

The implementation dates are from July 4, 2014 up to and including January 2, 2015. In February 2012, ITAC had introduced provisional ADDs of 62.93% on whole chickens and 46.59%, on boneless cuts on imports from Brazil. However, in June 2012, Brazil filed a complaint with the WTO and in December 2012 the South African government decided not to impose definitive ADDs on whole chickens and boneless cuts from Brazil.

South Africa first imposed ADDs on imports of frozen bone-in pieces (0207.14.90) from the U.S. in 2000 and in 2012 extended and increased the anti-dumping duties for another five years. The anti-dumping dutieswere increased to R9.40 per kilogram, without differentiating between suppliers as in the past.

Originally the ADDs ranged from R2.24/kg R6.96/kg depending on the supplier. Source: USTR 2014 National Trade Estimate Report on Foreign Trade Barriers; USDA/FAS GAIN Reports dated 2/10/2014, and 1/29/2013; http://govza.gcis.gov.az/node/487881, news wires.

U.S. Poultry Exports to South Africa Remain Blocked

At present, South Africa is one of a few nations in the globe that restricts U.S. beef, pork, and poultry. Conservative estimates indicate that the United States’ beef, poultry and pork industries(including pet food) are currently losing out on annual trade to South Africa worth about US$175 million, which is just over half the value of existing U.S. agricultural exports to South Africa.The market to South Africa is limited for these industries due to anti-dumping duties and technical trade barriers.

Annually, South Africa imports beef, poultry and pork products worth about US$630 million, largely from Europe, Brazil, and Canada. South African livestock product imports would not increase dollar for dollar with U.S. access, but exporters would have the opportunity to compete for supply with the EU, Brazil, and Canada. While USDA/Pretoria expects technical sanitary discussions to resolve some issues for beef and poultry, South Africa is resistant to taking action on pork.

Much progress was made in discussing USDA’s counter-proposal for South Africa’s importation of fresh poultry meat. The tone and lack of technical questions on the proposal indicated this is close to a positive resolution.

USDA/Pretoria remains optimistic that the issue requires only a few more technical clarifications prior to being finalized.South Africa’s long-standing (since 2000) poultry anti-dumping duties (ADD) against U.S. bone-in chicken keep the U.S. as a supplier of only niche products, like MDM and livers. During the recent Annual Bilateral Forum with the South African Government, USDA/Pretoria approached the Department of Trade and Industry (DTI) about the ADDs; DTI was disinterested in taking any unilateral action to remove the ADDs and suggested U.S. poultry industry put forth a legal challenge during the next sunset review in 2017.

Although the U.S. is the 9th largest supplier of poultry to South Africa, the $3 million in imports is less than one percent of the total import market. In 2013, South Africa imported over $300 million in poultry, which were primarily bone in cuts from Europe and Brazil.

 

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