Cash injection has not solved crisis at Daybreak poultry farms

The crumbling state of operations at poultry producer Daybreak Foods has laid bare a devastating animal welfare and governance crisis. A court ruling handed down on Friday has dealt a decisive blow to the company, as the Gauteng High Court made final an urgent interim order obtained by the National Council of Societies for the Prevention of Cruelty to Animals in South Africa. (NSPCA) on 10 May.

Cash injection has not solved crisis at Daybreak poultry farms
- Advertisement -

The Public Investment Corporation’s (PIC) R74 million cash injection, originally intended to stabilise feed supplies and pay overdue salaries, was meant to offer short-term relief. But the Gauteng High Court ruled this did not absolve Daybreak of its legal and ethical responsibilities.

“The company’s entire defence was premised on the claim that the money had solved the problem,” the NSPCA said in a statement.

“But the court made it clear that real, sustained welfare interventions were still lacking.”

- Advertisement -

The court focused on the animals themselves, stating: “The urgency was necessitated by the collapse of [Daybreak’s] responsibility to appropriately care for the chickens in their possession and under their control, and that the management of Daybreak has collapsed and there was financial mismanagement of the available funds.”

The NSPCA, which brought the case after a whistleblower alerted it to the horrific conditions at the company’s breeder operations, documented what it described as “catastrophic welfare emergency”.

According to the NSPCA, more than 594 000 breeder birds were found at risk of starvation, cannibalism and neglect due to chronic underfeeding and inhumane culling practices, and 350 000 broiler birds had to be culled.

“This is not just a failure of farming practices; it is a collapse of basic ethical standards,” said NSPCA senior inspector Nazareth Appalsamy. “The breeder birds are not only starving, they are suffering immensely. Daybreak must now comply lawfully, or face contempt of court proceedings.”

The court order compels Daybreak Foods to immediately cease all inhumane culling practices; feed all birds appropriate, species-specific food throughout its operations; suspend breeding and placement of chicks until proper nutrition is ensured; submit a humane recovery plan within five working days; allow the NSPCA unrestricted access to all premises; and pay the NSPCA’s legal costs, jointly with the PIC.

The NSPCA, which deployed teams to the farms for 12 days, discovered that casual, untrained workers were tasked with killing large breeder birds by swinging them by their heads, a method both illegal and ineffective, the NSPCA said in a statement.

According to the NSPCA, Daybreak failed to disclose the worsening situation, delaying intervention until an internal whistleblower came forward.

“Without this tip-off, the suffering of these animals would have remained hidden,” said the organisation.

While the animal welfare emergency is the most visible symptom of Daybreak’s collapse, financial mismanagement and poor governance run equally deep.

On 20 May, the company was placed under voluntary business rescue. The PIC, which owns 100% of the company on behalf of the Government Employees’ Pension Fund, Unemployment Insurance Fund, and the Compensation Fund, supported the move.

Business rescue practitioner Tebogo Maoto has been appointed to steer the turnaround.

Interim chairperson of the Daybreak board, Dr Charlotte Nkuna, expressed cautious optimism.

“We welcome the appointment of the business rescue practitioner as part of the collective effort, together with the PIC, to rescue the company and save approximately 2 800 jobs.

We are confident that the business rescue proceedings will help Daybreak Foods to achieve a credible turnaround plan in the interest of all our stakeholders.”

However, the restructuring comes amid the DA alleging that two directors of Daybreak Foods received six-figure payments while workers went unpaid, chickens were left to starve, and the company edged toward entering business rescue.

The DA has written to Parliament’s Standing Committee on Finance, requesting an urgent hearing, and is now awaiting a response.

General manager of the Broiler Organisation at the South African Poultry Association, Izaak Breitenbach, said while he could not comment on what was happening at Daybreak Foods, the situation did not impact supply of poultry in South Africa.

“While we have already seen a reduction in production from Daybreak, other producers have taken up production to bridge the reduction. There will not be a shortage as a result of the situation at Daybreak.”

The NSPCA remains on-site, ensuring compliance with the court order. However, with hundreds of thousands of birds still at risk, the crisis is far from over.