Rainbow Chicken Ltd has revealed its early earnings fell an estimated 75 per cent as a result of an increase in imports, high costs and oversupply in its domestic South African market
The company revealed profit for the six months through December fell to US$5.9mn, whereas it was US$22.4mn the previous year, Rainbow Chicken Ltd said in a statement.
"Feed costs ultimately translate to a 17% increase for us on a rand-per-ton basis and we can't recover that in the market," said chief executive Miles Dally said.
"In terms of imports‚ there's no doubt that there's dumping taking place. Brazilian exports are now finding SA as a very good home. Most countries in the world have some form of protection - we don't."
The company stated, “The lower than anticipated earnings are mainly a function of two major issues facing the local poultry market, namely record levels of imports and high feed raw material input costs.
“The resultant over-supply in the local market has meant that the price of chicken in retail bears little reference to its cost of production.”