The recent High Court ruling against the department of agriculture, land reform and rural development regarding compensation for poultry culled due to bird flu has sent ripples through SA’s poultry industry.
The industry stands at a crossroads, with the promise of financial relief and a renewed commitment to effective disease management practices.
The court’s decision challenges the government’s long-standing “nil compensation” policy and has implications for disease management and financial stability within the sector.
Agriculture union TLU spokesperson Bennie van Zyl, articulated a comprehensive response to the ruling, emphasising the necessity for a holistic approach to disease management.
“We need a strategy that encompasses all livestock, including pigs, sheep, cattle and poultry,” Van Zyl stated. He highlighted the critical roles of vaccination, continuous research and robust veterinary services to manage and mitigate disease outbreaks effectively.
Van Zyl highlighted the dual responsibility in this scenario: he said the government must be equipped to respond swiftly to disease challenges, while farmers must adhere to stringent biosecurity measures to prevent the spread of infections.
Government support through well-equipped veterinary services was essential, he said. At the same time, “farmers must quarantine new livestock and follow phytosanitary guidelines”.
The ruling has shown the need for clear and transparent compensation guidelines for farmers. Van Zyl called for a legislative framework that ensures farmers are aware of their rights and the steps involved in the culling and compensation process. He said this is vital to maintain farmer productivity and food security.
In the case brought by a disgruntled poultry farmer from George, the High Court rejected the department of agriculture, land reform and rural development’s refusal to compensate farmers for chickens culled during avian influenza outbreaks. The court emphasised that the value of livestock should be assessed based on their state of health before infection, opposing the government’s stance that infected or exposed birds hold “no value”.
The judgment raised the possibility of substantial compensation claims, potentially amounting to billions of rand, by poultry farmers affected by outbreaks since its first rodeo in 2017. This decision could affect the industry, which has suffered losses exceeding R9bn during the severe 2023 outbreak alone.
The amount spent by RCL Foods to cull 410,000 chickens due to bird flu
— IN NUMBERS: R115m
Sapa egg organisation GM Abongile Balarane echoed Van Zyl’s sentiment, welcoming the court’s decision; however, he was cautious about the next steps.
“Perhaps let us wait and see the reaction by the department, with hope they will not appeal the matter. We are still negotiating HPAI vaccines with them and we do not wish this matter to cloud the discussions. But this is a positive outcome that we welcome,” Balarane said.
The financial toll of the bird flu outbreaks has been severe. RCL Foods, one of SA’s major poultry producers, reported culling 410,000 chickens, with a financial toll of R115m.
Astral Foods, the largest poultry producer in the country, suffered losses exceeding R2bn, leading to its first annual loss in its history, of R512m for the year ending September 30 2023.
Similarly, Quantum Foods continues to grapple with losses valued at approximately R37m due to the disease.
Despite these setbacks, industry leaders remain cautiously optimistic about the future.
Izaak Breitenbach from the SA Poultry Association (Sapa) highlighted the ruling’s potential to provide much-needed financial relief to farmers.
This decision will allow farmers to receive compensation based on the value of their birds before they were infected or culled, Breitenbach explained.
He pointed out that the devastating losses experienced during the 2023 outbreak, which led to the culling of 9.5-million birds and left many farmers unable to resume operations.
Breitenbach noted that with compensation, farmers could restart their businesses, aiding in the recovery of the poultry industry and enhancing job creation.
“This compensation for birds culled will give farmers the means of starting up their businesses again,” he said. “The industry slaughters 21.5-million chickens per week at present with vacant capacity of 1-million birds per week. With farmers starting to farm once they received compensation, it will assist the recovery of the industry and also greatly increase job creation.”
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