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In a classic narrative of one man’s poison is another’s meat, specifically pork in this instance, the listeriosis saga that had South Africa in a frenzy two months ago has resulted in the price of pork dropping significantly.
According to the chief executive of the South African Pork Producers’ Organisation, Johann Kotze, the price of pork is now significantly lower because the buyers are finally passing on the benefit derived from the low prices they pay when buying from farmers who were forced to lower the prices because of the sudden low demand.
Speaking to City Press, Kotze said because at least 2% to 25% of all processed meat had some pork in it, shortly after Health Minister Aaron Motsoaledi announced the listeriosis outbreak two months ago, piggeries were forced to lower their prices because demand dipped.
“Obviously the public lost confidence in the market after the minister’s announcement. The market crashed for a week but farmers had to continue to slaughter because it’s not like the beef market; we have to slaughter after 22 weeks. Buyers bought for half price because after the announcement there was a sudden oversupply,” he said.
Kotze explained that though former sold pork for almost the price immediately, the retailers did not lower their shelf price immediately.
“Volumes increased while prices dropped but the sector is turning the corner,” he said.
He pointed out that because piggeries used skilled labour, there weren’t many job losses there but the processing plants experienced massive job cuts.
The listeria hysteria, Kotze said was particularly hard on new and small-scale pig farmers.
Following the announcement of the outbreak, a number of plants and abattoirs by big food industry players shut down. With that, coupled with prices plunging to as little as R10 a kilogram, the sector saw red.
Kotze said with Enterprise, which took up 12% of the pigs in the sector, fingered in the saga, drastic market changes were bound to happen.
“It looks like there’s a stronger demand for processed meat because of the lowered prices,” he said.
The local pork market is niche. Kotze said only about 10% of pork was imported and mostly from the European Union and Brazil while the country exports to other African countries.
According to the latest figures by Sappo, pork imports increased by more than half from 2233 tonnes in February to 3501 tonnes with South America increasing its import by a significant margin in March, the month the announcement was made.
During the same period, there was not much change in the pork exported. South Africa exports to 19 countries including across the continent, to the UAE, Maldives as well as Panama.
The import figures also indicate that average price also dropped from R31.71 per kg to R27.58 per kg.
Meanwhile the two class actions against Tiger Brands have been merged and according to George Kahn of Richard Spoor Inc, the amount sought is yet to be determined as various claimant would be seeking different amounts.
