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You are here: Home/News/Article/Distribution quota for cheap US chicken works against poor, says Shoprite

Distribution quota for cheap US chicken works against poor, says Shoprite

Distribution quota for cheap US chicken works against poor, says Shoprite
Published date:
Monday, 21 December 2015

Shoprite, South Africa’s biggest food retailer‚ says it is worried consumers will not benefit from cheap chicken after the recent approval of US imports without antidumping duties.

The group says at least half of the 65‚000 tonnes of the chicken quota will be given to middlemen that do not necessarily have the infrastructure or the distribution network needed, and so the true price benefit will not reach consumers who need it most in trying economic times.

"Shoprite understands the minister’s mandate to allocate a portion of the quota to historically disadvantaged individuals but it can’t comprehend why a minimum 50% must go this route as the benefits of these imports must also reach previously disadvantaged consumers in the form of lower chicken prices in stores‚" Shoprite said on Sunday.

"Shoprite also questions the allocation criteria of the remaining 50%, which is based on historical import volumes. Firstly‚ the allocation doesn’t take into account actual sales to end consumers."

As the largest seller of frozen chicken in the country‚ it said‚ Shoprite had the best footprint to reach the majority of South African consumers living below the bread line.

"In this regard‚ Shoprite has committed itself to sell any of the imported duty-free chicken it imports at cost price to provide maximum relief to consumers.

"Secondly‚ Shoprite believes that using historical imports to determine the allocation of the quota is disingenuous since it by definition penalises retailers who have supported the local producers for many years."

The group also called on the Department of Trade and Industry to consider the effect of the imports on local suppliers and thousands of South African poultry producers, and asked for prioritisation of investment in their growth.

"Selling 60% of all frozen chicken in South Africa‚ Shoprite is committed to support and develop local enterprises supplying chicken to the retail industry. There are plenty of opportunities and a constant demand for poultry products that outstrips supply in the country‚" Shoprite said.

It noted that Kholofelo Maponya’s company‚ Daybreak Poultry Farms‚ was one such supplier that the Shoprite Group had aided. Less than two years ago almost 2‚600 employees of the company could have lost their jobs‚ and now it held a 7% share of the South African poultry market‚ Shoprite said.


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