Significant challenges face the South African poultry industry as prices for fresh, whole chickens have surpassed the R40/kg mark. Absa Agri believes these high prices could persist in the coming months.
By Alani Janeke, Senior Journalist at African Farming and Landbouweekblad
Problems with the chicken supply arose in May this year when Brazil, South Africa’s key supplier of mechanically deboned meat (MDM), reported its first outbreak of highly pathogenic avian influenza (HPAI).
This severe outbreak affected several states in Brazil. South Africa was therefore compelled to impose a complete ban on poultry imports from that country.
According to Absa Agri’s latest trends report, this development has had widespread effects on South African consumers, particularly those in low-income households.
MDM is a vital component in affordable, processed meat products such as polony and Vienna sausages, which are staple foods for many South African families and play a significant role in food security and affordability.
Although the import ban was lifted after Brazil was declared free of HPAI on 23 June this year, it caused considerable damage to local supply chains.
The situation was worsened by operational problems at a major local poultry supplier, which contributed to the limited supply.
The report states, “The combination of reduced Brazilian imports due to the ban period, as well as local operational problems, has put supply under pressure and led to the high price levels.”
Also read: South Africa lifts the ban on Brazil’s poultry imports
High Prices Could Persist
These price hikes are increasing pressure on consumers who are already facing economic challenges. “Prices for fresh, whole chickens have not only surpassed the R40/kg mark but are expected to stay high in the coming months.”
Despite lower feed costs and the normalisation of trade flow, chicken prices could stay high during the festive season, supported by higher red meat prices and the expected seasonal rise in demand.
Encouraging developments do lie on the horizon. The implementation of vaccination programs and improved biosecurity protocols is expected to support production resilience in the local market. If feed prices continue to decline and supply chains fully return to normal, producers’ margins could improve, which could potentially stimulate production and help normalise price increases in the medium term.
According to Absa Agri, the ongoing problems in the poultry industry highlight the vulnerability of South Africa’s food security to international trade disruptions and the critical importance of maintaining viable local production capacity and biosecurity measures.
Read the full report.
