The South African Poultry Association (SAPA) have filed yet another anti-dumping application, this time on bone-in chicken from Brazil, Denmark, Ireland, Poland and Spain. We have not yet had sight of the application and the initiation notice itself seems to have been published in the wee hours of Saturday morning, so not sure how many people saw it.

The requested position is as follows:

Brazil

Tariff headingDescriptionRequested margin of dumping
0207.14.93Frozen leg quarters80.90%
0207.14.95Frozen wings124.35%
0207.14.96Frozen breasts (with bone in)9.02%
0207.14.99Other frozen bone-in133.16%

Denmark

Tariff headingDescriptionRequested margin of dumping
0207.14.93Frozen leg quarters172.38%
0207.14.95Frozen wings194.85%
0207.14.97Frozen thighs201.05%
0207.14.98Frozen drumsticks172.38%
0207.14.99Other frozen bone-in160.00%

Ireland

Tariff headingDescriptionRequested margin of dumping
0207.14.93Frozen leg quarters161.00%
0207.14.95Frozen wings148.57%
0207.14.97Frozen thighs177.66%
0207.14.98Frozen drumsticks153.40%

Poland

Tariff headingDescriptionRequested margin of dumping
0207.14.93Frozen leg quarters39.18%
0207.14.95Frozen wings27.36%
0207.14.98Frozen drumsticks29.81%

Spain

Tariff headingDescriptionRequested margin of dumping
0207.14.95Frozen wings102.22%
0207.14.97Frozen thighs114.12%
0207.14.98Frozen drumsticks82.00%

What next?

After you have taken a long, deep drink directly from the bottle of the alcoholic beverage of your choice, you should note the following:

  1. The period of investigation is July 2019 to June 2020. This will be period which ITAC will use to determine if a given exporter was or was not dumping. If you did not export in this period, your information will not be considered.
  2. Of particular importance to producers, if you do not respond to the investigation, you will be faced with the requested duty. Producers who do participate will have their own information used in their own anti-dumping calculation. In other words, if 1 company responds from Denmark and is found to have a dumping margin of 5%, that will be their duty, while the other companies in Denmark will receive the requested position.
  3. Importers need to also pay attention. Your input is different but equally important if you do not wish to be burdened with these large anti-dumping duties. The lesser duty rule (which gives a second method of calculating the anti-dumping duties), is only available if all of the importers connected to an exporter respond.

A response (particularly a producer response) is a lot of work. Countries cannot respond collectively to the dumping calculation, leaving that part of the work to the individual companies.

The deadline to respond, without an extension is around 29 March 2021.

Do not underestimate the amount of work to be done in the next month and the consequences of missing the deadline is dire, as can be seen from the requested duties.

This date will only be finally confirmed on receipt of the documents, and there is some uncertainty, because there are public holiday in between which can change the deadlines. Nevertheless, it will be close to this day.

Need help responding? We are the most experienced consultancy in the country in all matters relating to chicken. Say hello at info@xa.co.za, but do so quickly.

Chicken anti-dumping cases are notoriously complex and we are dealing with one of the most protected industries in the country.

Impact of the duties, if implemented

Yet another swig is required before continuing. The only countries moving any significant volumes to South Africa at the moment are these 5 countries, plus the USA. The USA already has a negotiated exemption from the anti-dumping duties, but this exemption is capped at 69 000 tons of bone-in chicken a year. Beyond that the R9.40 per kg in anti-dumping duties makes the product prohibitively expensive, although compared to some of the requested duties in this case, that actually looks quite modest!

Bringing me to my next point. If the duties are imposed, they will be imposed on top of the duties already in place. In the case of Brazil, this means the anti-dumping duties would be added to the 62% duty already in place. For the European countries this will be on top of the questionable bi-lateral safeguard duty currently in place (Currently 25%, but due to drop to 15% on 12 March 2021).

If these duties are imposed at the requested levels, what would happen to chicken prices in South Africa? Undoubtedly they will rise and rise significantly. Given that over 60% of all protein consumed in South Africa is chicken, what will the people eat? Good question. Cake I suppose.

Don’t delay! Mail us at info@xa.co.za

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