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Suspected dumping hits poultry sector

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Key poultry sector stakeholders are worried about suspicions of imported frozen chicken being dumped onto the Ghanaian market,

Key poultry sector stakeholders are worried about suspicions of imported frozen chicken being dumped onto the Ghanaian market, citing several reasons including low cost of the product vis-à-vis high taxes slapped on the commodity and other crucial reasons.

Despite a tariff of 35 percent and other taxes slapped on imported frozen chicken, price of the product on the market in the last four years has been relatively low compared to the domestic variety.

A network of privately owned cold-stores in Ghana control the imported frozen chicken trade and its distribution.

Data from the Ghana Incentive-Based Risk Sharing-System for Agriculture Lending (GIRSAL) indicate that in 2018 the price for a kilo of imported chicken was GH¢14.56 against a kilo of locally produced chicken which was GH¢19.16 at the time. In 2019, the price stood at GH¢12.63 for a kilo of imported variety against GH¢21.11 of the local breed.

In December 2020, a kilo of imported chicken was sold at GH¢12.73 against GH¢23.12 for domestic chicken. Last year, a kilo of imported variety was sold at GH¢15.31 with the cost of the locally produced type at GH¢25.54 per kilo.

Currently, a kilo of imported variety is sold at an average price of GH¢25 with the domestic type selling at an average of GH¢48.20.

Are we experiencing dumping?

The Chamber of Agribusiness Ghana (CAG) has indicated that the allegation of dumping is undebatable – not only considering the pricing mechanism of imported chicken despite the high taxes, but more importantly the low value of the type of chicken imported into the country; mostly without premium parts such as breasts and fillets.

“When you have high taxes on imports, the expectation is that such products do not become that cheap compared to what is produced here without taxes. The type of parts which are imported here – thighs, wings, feet, neck – which constitute almost 95 percent of imports against premium parts such as breast and fillets, also calls for suspicion,” CEO-CAG, Anthony Selorm Morrison, told the B&FT.

A study by the Physicians Committee for Responsible Medicine – a nutrition-oriented NGO based in Washington DC – indicates that the highest fat, calories and cholesterol content of frozen chicken comes from the skin, wings, thighs and drumsticks.

The need to focus on domestic production and revitalisation

Mr. Morrison said it is important for government to refocus on the poultry industry to save it from current production woes.

“Poultry farmers continue to sell their farms; the price of feed products keep escalating, which is affecting the cost of production. Government must intervene,” he said.

Current poultry industry situation

Indeed, 85 percent of commercial poultry production focuses on eggs for the local market, as most farmers only concentrate on broiler production for sale during festive seasons.

Rising domestic demand for chicken is met by imported frozen chicken, which come as pre-cuts ready to use and is cheaper than locally produced chicken – mostly the thighs, wings, feet, neck and back.

The three largest exporters of poultry products into Ghana are: the Netherlands – 35 percent of imports; Poland, 23 percent; and the USA, 22 percent.

With a national demand for chicken in excess of 360,000 tonnes per year as of 2021, local producers are only able to produce about 60,000 tonnes per annum – with about 90 percent of such being layers.

The Ministry of Finance has said the country spends an average of US$200million on chicken imports annually, with some US$721million spent on chicken and meat imports since 2020.

The volume of frozen chicken imported into Ghana has reached an annual average of 290,000 metric tonnes since 2021, according to the United States Department of Agriculture (USDA).

Key sector challenges

The poultry sector continues to battle with high cost of production. Current feed-cost constitutes 60-70 percent of production cost – mainly driven by maize and soya prices, data from GIRSAL has indicated.

The prevalence of unattractive packaging is also a bane, as most birds are sold live as whole chicken.

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