Increased poultry tariffs may result in US backlash

JOHANNESBURG – South Africa could see a trade backlash from the US after the Department of Trade and Industry (dti) announced on Friday that it had increased tariffs on poultry imports, the industry warned, but “time would tell”.

The National Treasury said in the Government Gazette on Friday that the government had increased tariffs on frozen bone-in chicken pieces to 62percent, up from 37percent for imports from all nations, excluding the EU and members of the Southern African Development Community.

Levies for frozen boneless chicken cuts were increased to 42percent, up from 12percent. The industry had applied for tariffs of 82percent under both categories of products.

Local producers supply about 70percent of consumption in South Africa, and the new tariffs would apply to more than 30percent of all imported chicken.

However, the higher tariffs could backfire. South Africa benefits from the African Growth and Opportunity Act (Agoa), which grants qualifying countries duty-free access to US markets for thousands of goods. In return, the US is able to export a maximum of 6000 tons of frozen bone-in chicken portions for free to South Africa.