Aug. 27 (Bloomberg) -- Rainbow Chicken Ltd., South Africa’s largest poultry producer, said the industry needs protection from imports as it reported a 94 percent slump in profit.
Net income dropped to 16.7 million rand ($1.6 million) in the 12 months ended June from 266.8 million rand, the Durban-based company said today in a statement. It scrapped the dividend.
“Rainbow has experienced an extremely difficult year with high import volumes and record feed input decimating margins,” it said. “The poultry industry is at crisis point and anti-dumping protection is key to the survival of the industry.”
The South African Poultry Association has asked the International Trade Administration Commission of South Africa to raise duties to as much as 82 percent from the current 5 percent-to-27 percent range. It claims imports of some poultry cuts from Brazil and Europe are hurting the local industry and may lead to as many as 20,000 job losses. The Association of Meat Importers and Exporters, a local meat-trading lobby group, says increasing duties will drive up food costs for local consumers.
A decision on tariffs is expected in the “near future,” Rainbow said.
The company, which will change its name to RCL Foods Ltd. on Sept. 2, bought an 88 percent stake in New Foodcorp Holdings (Pty) Ltd. in two transactions this year as it seeks to diversify its product range.
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