The meat processing industry has urged the government to secure an agreement that will restore poultry imports from Brazil and avoid an imminent food supply crisis.
The government has banned poultry products from the South American country, which recently announced a bird flu outbreak in one of its regions.
While South Africa's chicken supply remains stable, meat processors are concerned about the supply of mechanically deboned meat (MDM), chicken offal and other poultry products that are not adequately produced locally and could run out in weeks.
Georg Southey, manager at Merlog Foods, told Business Times that wholesalers and retailers had started panic buying in preparation for a possible shortage, which would affect the ability of the local market to make products such as sausages, polonies and pet food.
“[In terms of the damage] I believe it’s already started ... the produce in the supply chain at the moment has seen panic buying from operators and retailers trying to buy whatever raw materials are available and stockpile them.
“The available materials and alternatives that are imported are already selling at double the price that they were two weeks ago. That is out of panic from the factories that are worried that they will run out of raw materials in two weeks' time.”
He said the department of agriculture’s “blanket ban” was likely to trigger a shortage of 400-million meals a month.
“Because of vulnerability due to lack of formal employment and an unofficial unemployment of around 43% ... we don’t have an elasticity where consumers can afford higher prices. Prices for all available proteins will be substantially increased for the next few months. We are already seeing it at a wholesale level, and it will no doubt push through into the retail level.”
Southey said South Africa has less than three weeks of food reserves in some key categories, with possibly devastating consequences for food security for an estimated 30% of South African households that already have inadequate food.
“[The government] has ... decided that they are going to take the most restrictive route to approach Brazil. Even though Brazil has proposed a zoning protocol, they haven’t agreed because the current import permit hasn’t been resolved yet and no certification can take place until the permit has been amended.”
Dr Mpho Maja, the national director for animal health, said the government met with Brazil last week but had no plans for further meetings until they have an update on the H5N1 avian influenza outbreak.
“We had a meeting last week. We were not planning another meeting, but we are ... expecting information from Brazil. So if it warrants a meeting, we will have another meeting.”
The ingredients for certain products would run out eventually, with no feasible alternatives in sight.
— Bruce Smit of the South African Meat Processors Association
Maja said she had not heard about retailers or wholesalers panic buying MDM and other meat products. She said the government’s response to the Brazilian outbreak was informed by a need to protect local birds and consumers in line with the World Organisation for Animal Health's standards.
“We accept all measures that are internationally recognised — zoning, regionalisation and compartments, provided that they comply with the requirements of the World Organisation for Animal Health. We are having conversations with everyone on these requirements, and that includes Brazil.”
Bruce Smit of the South African Meat Processors Association said the group had requested a meeting with the government, including the department of agriculture, but it had not yet been confirmed.
“The shortage of MDM, chicken offal, is going to create a food security crisis,” he said.
The ingredients for certain products would run out eventually, with no feasible alternatives in sight.
“Everybody has their own challenges. Some of the guys will add raw material, but some countries have priced it at over $1,000 (R18,000) a ton from markets like Argentina. They don’t have the volumes, and at that price, the price of polony will begin to become unaffordable.
“You will have a best-case scenario of a 60-day interruption of a critical supply for this product. There are no alternatives. Factories will have to lay off workers and do what they can until their supply gets back on track, until we reach a trade agreement with Brazil.”
He said Namibia and Japan had agreements to continue importing from Brazil and he hoped that there would be a similar deal between South Africa and Brazil.
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