Country’s poultry industry transformation is under the spotlight
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MAJOR poultry producers have declared that transformation targets in the sector allowing broader participation of black emerging farmers, will be surpassed by 2022, allowing farmers into aspects of the industry not defined in the Poultry Sector Master Plan currently cooped up by the Department of Trade Industry and Competition (dtic).
In response to concerns by the African Farmers Association of South Africa (Afasa) as well as the Emerging Black Importers and Exporters (EBIeSA) – that black emerging farmers were kept on the skid-lines of the industry supply chain with limited participation and capacity – the South African Poultry Association (Sapa) said this week that offshoots of the Master Plan were already bearing fruit with more growth anticipated over the next 12 months.
“Black contract growers are farming 12.6 million birds as we speak, and this will increase to 16 million birds over the course of the next 12 months. In the past two years alone, emerging black farmers have built 79 poultry houses to the value of R355m, while the industry invested a further R1.14 billion to create markets for these additional chickens. This is massive for our emerging farmers, and for South Africa,” Sapa chief executive Izaak Breitenbach said.
Breitenbach said 40 independent producers were supplied with business plans, environmental impact analyses and water licences to enable them to farm, including an additional 40 farmers being assisted with the various aspect of their operations.
“Our first black hatchery owner has expanded from hatching 7 000 birds per week to now doing 28 000 birds per week, and by the end of the year they will achieve 50 000 chicks per week to supply the independent market.
“In all 1 963 emerging farmers were trained in the various aspects of their farming operations, while an additional 1 460 farmers are receiving remote assistance,” he said adding that there was a material acceleration of transformation effort. It is eminently desirable for emerging farmers to succeed.
However, Kobedi Pilane, the co-ordinator of the African Poultry Producer (APP) chapter in Afasa, said the stake needed to be higher for emerging producers, with as much as 60 percent interests, and also argued for the opening up of the export market to the United Arab Emirates and the EU itself, which had shown a penchant for pre-cooked white chicken portions.
Pilane argues against the closing off of imports to protect local producers, whom he identified as holding more than 75 percent of the market and are in the main white and male, which has clogged up the industry for black producers in the supply of inputs including chicks and eggs.
“The monopoly can change, Sapa argues imports have to close to allow local producers to dominate the market. The master plan is failing, the whole master plan has to change because it is a continuation of the dominance by established producers who only want emerging farmers to be growers. The industry has to be opened up, the domestic market is clogged,“ Pilane said.
Last year, consumers spent about R250 billion on meat products, which represented 35 percent of total expenditure on food with poultry representing at least 60 percent of total meat.
Broiler meat accounts for more than 95 percent of all poultry meat imports by South Africa, with the balance largely being turkey products. South Africa imported 490 475 tons of poultry meat last year at a value of $325 million (R5bn).
Meanwhile, Afasa has decried the lack of eggs, day-old chicks and other supplies during peak seasons such as Easter and Christmas when black farmers were sidelined in stock.
But Sapa said this was an industry reality when demand increases to beyond that of the chick supply during Easter and the build up to Christmas.
“Sales to fast food restaurants increase by as much as 30 percent during the build-up to Christmas, when a lot of small farmers start farming only for the 6-month period July to Dec. This creates a shortage. Additionally, this year avian influenza (HPAI) had a major impact, causing a lot of breeder birds to be culled, resulting in an even bigger shortage of day-old chicks,” Breitenbach said.
He said even in the formal sector slaughters are down from 22 million birds per week to 19m birds per week, relating to a 14 percent fewer chicks hatching than before HPAI.
“Everyone feels this pinch,” said Breitenbach.
BUSINESS REPORT ONLINE