Local employment and chicken were in the spotlight yesterday after Rainbow Chicken, a division of RCL Foods, opened its second processing plant at Hammarsdale, west of Durban. This marked a return to full production, which was welcomed by the government and poultry industry.
In 2017 Rainbow had to close half of the Hammarsdale operation and retrench some 1 200 workers as cheap chicken imports decimated the poultry sector.
Rainbow said it had invested R220 million in their Hammarsdale abattoir and 78 new contract grower houses were being constructed at an investment by the growers of another R400 million.
The investment was announced in April during the South African Investment Conference at the Sandton Convention Centre in Johannesburg.
The firm aims to bring Rainbow’s production volumes back to the pre-2017 levels and return the plant to full operating capacity, as well as help create an additional 406 jobs within the KwaZulu-Natal community, including the re-employment of some of the workers retrenched in 2017.
Delivering the keynote address at the 60th anniversary celebration event hosted by Rainbow in Hammarsdale, Department of Agriculture, Land Reform and Rural Development (Dalrrd) Minister Thoko Didiza said, “The investments made into Hammarsdale is a symbol of success from public-private partnerships, uplifting the confidence in agriculture and critical industries such as poultry.”
She said South Africa’s trade policy - with the introduction of anti-dumping duties, increasing bound tariffs, and other safeguard measures - had given the industry much-needed support and protection against unfair competition.
Between 2019 and last year, domestic production for chicken meat had increased from 1.7 to 1.84 million tons per year outpacing local consumption which decelerated by 7% during this period.
She said the inauguration of the project, aimed at reinstating a second processing shift at Rainbow’s Hammarsdale processing plant, symbolised the success of several aspects of the Poultry Sector Master Plan including investment, job creation, poultry exports and the establishment of black contract growers.
Poultry was the single biggest industry in the livestock sub sector worth R54 billion last year.
"The sector employs more than 100 000 persons. The industry value has been growing at an average of 5.3% per annum since the industry and government signed the Poultry Master Plan in 2019. The interventions committed under the Poultry Master Plan are yielding positive outcomes. Domestic producers like RCL Foods and others have headed the call to increase local production and create jobs," she said.
Didiza said when they launched the Blended Finance Scheme with the IDC (Industrial Development Corporation) and Land Bank, they ensured that poultry was one of the strategic products that should benefit. "I am happy that the South African Poultry Associations has been working with these Developmental Finance Institutions to ensure farmers benefit from affordable finance."
To reduce the cost of feed, Dalrrd said it was working with the grains and oilseeds commodity groups to identify new areas that could expand the production of raw materials for animal feed.
FairPlay founder Francois Baird said, “The return to full production at Rainbow Chicken’s Hammarsdale plant is a joy for workers, both re-employed and new, and a tribute to Rainbow management.”
He explained that it had special significance for FairPlay, because the decision to close half of the Hammarsdale operation and retrench some 1 200 workers seven years ago had led directly to the founding of the FairPlay movement.
“Nearly seven years later, the battle continues, because dumping continues. But poultry industry investment in terms of the master plan is creating new capacity to supply South African consumers, and hopefully a profitable export market.
“Because of that expansion, Hammarsdale is once again in full production. The once-shuttered plant has been refurbished and expanded, with almost 500 new jobs being created,” Baird said.
He said, that it was a special occasion for all involved.
“It is a very special moment for FairPlay because it encourages us to keep on fighting against unfair and illegal trade, and for workers and their jobs,” he said.