The South African Revenue Service (SARS) has imposed a temporary levy on Brazilian poultry products after allegations of dumping from certain exporters.
The provisional payments will be applied until 10 August 2012, and range from 6.26% for frozen boneless cuts exported by Aurora Alimentos to 62.93% for all frozen whole birds. The tax levels are meant to compensate for the levels of dumping observed during an investigation by the South African International Trade Administration Commission (Itac).
“At the conclusion of the preliminary phase of the investigation and to prevent further injury to the domestic industry while the investigation continues, the Commission decided to request the Commissioner for SARS to impose provisional payments, equal to the dumping margin, on the importation of chicken meat from Brazil.
“It should be noted that the aim of anti-dumping duty protection is to eliminate unfair competition from foreign producers – that is, to level the playing field so that foreign producers compete fairly with domestic producers. The aim is not to ban imports altogether,” Itac said.
In June 2011, the Commission launched an investigation following a complaint by the Southern African Poultry Association (SAPA), that alleged that certain categories of chicken meat originating from Brazil were dumped on the South African market– in other words, sold at lower prices than on the domestic market.
Itac gathered evidence with the contribution of three Brazilian exporters and one South African importer, and found that the majority of Brazilian frozen whole chickens and boneless cuts were being dumped by 62.93% and 46.59% respectively. Aurora Alimentos was found to dump boneless cuts by 6.26%, which is why the levy was lower for this company.
After considering various criteria, including sales volumes, profits and market shares, Itac also found that South African producers had suffered from the unfair competition caused by Brazilian exporters. “The Commission found that the [South African] industry suffered material injury in the form of price undercutting, price suppression, declining output volumes, market share erosion, under-utilised production capacity, and reduced growth,” Itac said.
SAPA welcomed the decision and committed to continuing its fight against unfair competition from Brazilian exporters. "Brazil has not adhered to the principles of fair trade and their performance in accessing the South African market has not been conducted in an entirely fair manner. We appreciate that rigorous and thorough manner in which Itac has applied itself to this matter. As this finding is made in terms of WTO rules as a preliminary finding, we look forward to the final determination in due course," said SAPA chairman Marius Gericke.