The South African government has introduced a new trade measure allowing businesses to import frozen chicken from the United States without paying anti-dumping duties.
Black-owned businesses offered crucial deal on chicken imports
This initiative, known as the quota permit under Rebate Item 460.03/0207.14.9/01.07, is aimed at supporting black-owned businesses by giving them priority access to cheaper imports.
The permits will be allocated every quarter, covering the period from April 2025 to March 2026.
By removing the additional taxes usually imposed on US chicken imports, the government hopes to lower costs for businesses and consumers.
The Department of Agriculture, Land Reform, and Rural Development (DALRRD) has specified that black-owned businesses will receive priority in the allocation process, aligning with the country’s Broad-Based Black Economic Empowerment (B-BBEE) policies.
Eligible businesses include retailers, supermarkets, restaurants, and meat suppliers. However, they must be tax-compliant, provide import records from the past three years, and meet other administrative requirements.
Each applicant is required to pay a non-refundable R1,600 application fee and submit their requests in person or via courier, as email or fax submissions will not be accepted.
However, this move comes amid growing concerns that South Africa could soon be excluded from the African Growth and Opportunity Act (AGOA), a trade agreement with the United States that allows duty-free access to American markets.
If South Africa is removed from AGOA, the consequences for the poultry industry could be severe.
Here’s how it works
The quota permits divide the total allowed chicken imports into four quarters.
Businesses applying for imports between April and June must submit their applications before mid-March. Further opportunities to apply will be available in May, August, and November.
Each company can only apply once, even if it owns multiple businesses.
By waiving anti-dumping duties on these imports, the government aims to lower costs for businesses and consumers.
The move could introduce more affordable chicken into the South African market, potentially reducing prices in stores.
However, concerns remain that increased imports could negatively affect local poultry producers, who already face challenges such as rising input costs and competition from international suppliers.
What happens to local poultry if US kicks SA out of AGOA
South Africa’s participation in AGOA is under scrutiny, with US lawmakers calling for the country’s removal due to diplomatic tensions.
If South Africa loses its AGOA benefits, the poultry industry may face higher costs for American imports, as the current exemption from a R9.40/kg anti-dumping duty would no longer apply.
Industry experts, including Hume International’s Roy Thomas, have previously warned that the potential loss of AGOA could lead to significant price increases for imported poultry.
This comes at a time when the global poultry industry is already strained by bird flu outbreaks, particularly in Brazil, South Africa’s largest chicken supplier.
New import tariffs on Brazilian and European poultry, set to take effect in August, could further exacerbate supply issues, limiting alternative sources of affordable chicken.
While local poultry farmers may benefit from reduced competition if US imports become more expensive, this could drive up domestic prices, making chicken less affordable for consumers.
Import restrictions could also affect food security, as chicken is South Africa’s most consumed meat, with an average annual consumption of 1.8 million tonnes.
The government is facing increasing pressure to secure stable poultry imports while balancing the interests of local producers. If AGOA is revoked, businesses and consumers may have to brace for higher chicken prices, potentially making a staple food less accessible to millions of South Africans.