Abstract

The study examined the relative efficiency of producing chicken meat in South Africa, in 2017, and its comparative advantage in chicken meat production in Southern African Development Community (SADC). The study used the Policy Analysis Matrix (PAM) to calculate the net financial and economic profitability, Nominal Protection Coefficient of output (NPCO), Nominal Protection Coefficient of input (NPCI), Effective Protection Co-efficient (EPC), Private Cost Ratio (PCR) and Domestic Resource Cost (DRC). Data used in this study was taken from the statistics collected by the Department of Agriculture, Forestry and Fisheries (DAFF) and South African Poultry Association (SAPA). The findings, based on the indicators of NPCI, EPC and PCR conclude that the existing government policy environment tends to protect the interest of the chicken meat producers at the production level. The DRC results indicated that South Africa had comparative advantage of producing chicken meat in 2017. Key words: Domestic resource cost, policy analysis matrix, private cost ratio. &nbsp

Highlights

  • The South African gross value of agricultural products was projected to be over R 246 billion in 2016

  • About 108,000 indirect and direct jobs in South Africa are provided by the chicken meat production industry and related value chain industries (DAFF, 2016)

  • The study used secondary data which was obtained from the South African Poultry Association, Department of Agriculture, Fisheries and Forestry (DAFF) and from own calculations where necessary

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Summary

Introduction

The South African gross value of agricultural products was projected to be over R 246 billion in 2016. A bigger share came from the animal products sector. The sector contributed 46.9% (R 117 billion), 30% was from horticultural products and 23.1% was contributed by field crops ((Department of Agriculture Fisheries and Forestry) (DAFF), 2017). The South African broiler industry contributed R37 billion, which formed 16.5% of the overall agricultural production output in the financial year 2014/15 (Joubert, 2017). About 108,000 indirect and direct jobs in South Africa are provided by the chicken meat production industry and related value chain industries (DAFF, 2016). The chicken meat value chain integrates into other value chain industries, for example, maize production since maize is used as feed to chicken (Joubert, 2017)

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