That is, if US senator Chris Coons, chairperson of the African Affairs sub-committee of the Senate Foreign Relations Committee, has his way. Representing one of the US’s two major chicken-producing states, Delaware (the other is Kentucky), his constituency demands he ensure anti-dumping duties on imports of US chicken be scrapped. The constituency insists these duties are illegal, despite a World Health Organisation panel stating otherwise.
Coons was diplomatic in a recent Business Report interview, but he is on record telling the US Poultry and Egg Export Council in December that he would “do everything in [his]power to make sure [the South Africans] do not derive any benefits from Agoa if they do not end the illegal anti-dumping duties against US chicken”.
How much clout he and the senator of Kentucky will have in the Agoa negotiations remains to be seen, because if the SA Poultry Association (Sapa) has its way, no cheap chicken will enter SA without paying import duties. At least the association is in negotiations with the US to come to an agreement as to the amount of poultry that would be allowed into the country, and at what price.
But Coons told Business Report that the window of opportunity to negotiate the renewal of Agoa was closing as soon as April, because the US had bigger fish to fry: Pacific trade agreements.
South Africa can ill afford to be excluded from Agoa. In 2014, local exports to the US under Agoa were $3,6 billion. The motor industry delivered 60 000 units to the US while agricultural exports were valued at $2,34 million. It is ultimately the SA government’s call on what import duties on US chicken should be. They seem sympathetic to Sapa’s plight; after all, Sapa provides employment, directly or indirectly, to an estimated 108 000 workers, playing a crucial role in rural development.
Should the US stick to its guns, the local poultry industry will most likely be sacrificed. Critics of Sapa’s anti-dumping request, namely the Association of Meat Importers and Exporters, have been calling for poultry producers to up their game instead of crying foul when foreign producers manage to produce poultry for less.
This is unfair. At a technical level, our industry is running efficiently, but when it comes to inputs, producers fork out much more than their competitors. Instead of trying to level the playing field for marketing agricultural products, maybe government should rather look at levelling the playing field at input cost level, thereby benefiting both big and small producers. Or, will that simply open another can of worms?
