By Carien Kruger
The local poultry industry, especially egg farmers, is concerned about the high risk that avian flu could again this year.
The bird flu outbreaks in commercial flocks in various countries late last year and an outbreak on Marion Island, southeast of South Africa, which could act as a reservoir for the virus to spread to South Africa, increase the risk of the local poultry industry being affected again this year.
The egg and broiler industry suffered billions in losses during the 2023 avian flu outbreak when it infected breeding flocks, and the egg industry had to cull millions of laying hens.
The state doesn’t pay compensation for culled chickens, nor does it have or have a practical or affordable vaccination protocol.
Dr Abongile Balarane, chief executive of the South African Poultry Association’s (SAPA) egg organisation, said in early December that the organisation was highly concerned about global avian flu outbreaks, including in America and Australia.
“To tell the truth, we feel panicked that avian flu is on our doorstep. If we are hit by avian flu again this year, the consequences will be catastrophic.”
According to him, in 2024, there were 278 reported outbreaks in 18 European countries, with a new H5N5 strain confirmed for the first time on a European poultry farm.
The 2023 outbreak in South Africa caused the national laying hen flock to shrink from around 27 million to 19 million. By December 2024, it was back up to about 21 million hens.
Balarane says if there are no outbreaks this year, the flock size would likely reach its original size of 27 million in the second half of the year. He says vaccination is the logical solution for a situation where the government pays no compensation.
“We continue negotiating with the state about an inclusive vaccination strategy that is easy and affordable to implement.”
Minister’s intervention is needed
Izaak Breitenbach, chief executive of SAPA’s broiler organisation, says no poultry farm in South Africa has been able to meet the required standards for the vaccination protocol, which means vaccination cannot happen.
“This puts the industry in a dilemma. We appeal to the Minister of Agriculture to compensate members for culled chickens and to intervene to make vaccination possible. This is the only way the industry will be protected against the devastating impact of future avian flu outbreaks.”
The state has already approved three foreign H5 vaccines but not an H7 vaccine. A unique South African H7N6 strain caused devastation in the northern part of the country in 2023. The local development of an H7 vaccine began in 2023.
Breitenbach says the state says legislation requires the H7 vaccine to go through “complete testing”, which will take months to complete.
In June 2024, the High Court in Cape Town ruled in favour of an application from a farm that the Department of Agriculture must compensate it for culled chickens and destroyed eggs.
Breitenbach says although the department has not appealed the ruling, no compensation has been paid.
“The only way forward is for the Minister to resolve the deadlock.”
Producers also want to use the approved H5 vaccines because this strain broke out in Europe.
Recovery of the egg industry
Last year, the egg industry experienced significant disruption due to the smaller laying hen flock and a shortage of point-of-lay hens, meaning breeders had to import hatching eggs.
“The new point-of-lay hens are slowly becoming more available. We hope to achieve stability in the second half of 2025,” says Balarane.
Due to the challenging production circumstances, there are very few new entrants to the egg industry, and some producers have been unable to restart production after previous avian flu outbreaks.
“Most are struggling to acquire new stock due to lack of financing. Others are probably waiting to see if vaccination will be implemented.”
Activists request “no cage eggs”
According to Balarane, the SAPA is aware of the ongoing call by animal rights activists for South Africa to consider a system that bans cages in the egg industry. He represents South Africa and other countries in the region on the council of the International Egg Commission.
“We recently declared that each country should produce eggs based on its choices.
“South Africa is a specific market with a particular history. We are working to transform the sector and are part of BRICS, for whom food security is a priority. BRICS countries produce 60% of the world’s eggs.
“SAPA’s position is that South Africa should continue to use all three production systems, namely barn, free-range, and battery systems, to offer consumers different options regarding affordability.
“We were never against free-range production, but consumers don’t respond well to that system due to affordability,” says Balarane.
Industry hopes for VAT exemption
In the broiler chicken industry, one of the most important questions this year is whether the National Treasury will exempt some chicken meat from VAT.
The broiler organisation, together with its suppliers, customers, and the Association of Meat Importers & Exporters (AMIESA), submitted a well-considered request to the treasury in November 2024 to exempt frozen chicken meat, as well as frozen and fresh chicken offal, from VAT, says Breitenbach.
“This will bring relief for lower-income consumers.”
Broiler producers’ profitability improved last year thanks to better raw material prices for feed and the lack of load shedding. However, problems with infrastructure, especially water, still contribute to the cost burden.
Breitenbach doesn’t expect producers to expand their broiler production capacity this year.
“Producers will tread water, as there is slaughter capacity for a million chickens per week that is not yet utilised, and the threat of avian flu poses further risks.”
Due to the difficult circumstances, he says, there are no new entrants to the broiler industry.
Exports beckon
One of the objectives of the 2019 poultry master plan is to increase chicken meat exports to countries outside Southern Africa.
“We will be disappointed if Britain, the European Union (EU), and Saudi Arabia don’t give their approval this year,” says Breitenbach.
The industry has progressed with the necessary steps to export to Britain and the EU.
“We have submitted the residue monitoring programmes, and Britain will inspect South Africa in May of this year. We also expect an inspection by Saudi Arabia this year.”
Breitenbach says total imports in 2024 were more than in 2023, although the number of bone-in pieces imported (which hurts the local industry the most) has decreased.
“The total imports increased due to the rise in mechanically deboned meat and offal as these products are not subject to import tariffs.”
Anti-dumping tariffs apply to imports from various countries, but imports from Argentina worry the organisation. Argentina is not subject to anti-dumping measures and is dumping large volumes of chicken meat in South Africa.”
Imports from the EU, which are tariff-free due to a free trade agreement with Southern Africa where anti-dumping tariffs don’t apply, may be limited this year. Due to the numerous avian flu outbreaks, a ban has been applied to imports from certain other countries.
