SA’s major poultry producers will have to defend their business practices as the Competition Commission advances with its antitrust inquiry into a sector said to rake in more than R70bn in sales annually.
The commission has identified Astral, Rainbow Chicken, Country Bird and Sovereign as the country’s four largest chicken producers, accounting for nearly 63% of SA’s chicken production.
The competition watchdog has now finalised the terms of reference of the mooted market inquiry into the poultry industry value chain, which define the scope of the inquiry.
The terms of reference say the domestic industry “appears to be dominated by few, large and vertically integrated companies”, and that the market structure may pose significant barriers to independent entry at scale and could potentially encourage conduct that reinforces these barriers.
In terms of scope, the terms of reference show that the inquiry will look into whether there are market features which distort competition across the value chain, including pricing and access to key inputs such as genetic stock, parent stock, feed, fertile eggs, day-old chicks of pullets, abattoirs and cold-chain logistics.
The Competition Commission's inquiry into SA's R70bn poultry industry could reshape the sector. With four dominant producers controlling 63% of the market, concerns over fairness, barriers to entry, and power imbalances could lead to regulatory changes aimed at boosting competition and supporting smaller players.
The inquiry, which is set to start before the end of the year, based on the timelines outlined in the terms of reference, will also look into whether commercial relationships between contract growers and integrated producers are “characterised by bargaining power imbalances” and how these dynamics affect competitive outcomes and the growth and sustainability of small-scale producers.
“There are also market features of the poultry industry that are likely to impede, restrict or distort competition. Impediments to competition are themselves a concern, as they prevent the benefits of dynamic competition and greater levels of participation,” the commission said.
“While the precise impact remains subject to further investigation, a market inquiry aimed at examining these aspects could potentially lead to benefits in the industry which foster competitiveness and consumer welfare.”
The commission noted that the poultry industry, including broiler chicken and egg production, is the largest contributor to the agricultural sector in the country and accounts for about 17.8% of all agricultural output and 42.9% of all animal products. About 78% of the poultry birds are used for meat production, while the remaining 22% are for egg production, according to the commission.
The SA Poultry Association (Sapa) has said it will co-operate fully with the inquiry despite its misgivings.
“The poultry industry has for decades supplied SA with affordable meat protein. If it is to continue to do so, it deserves understanding and support.
“Through our contributions, we will try to ensure the inquiry does no further harm to this strategic national industry,” Sapa said when the commission first announced its intention to launch the inquiry last year.
Correction: October 3 2025:
This article has been corrected to reflect that Rainbow Chicken, and not RCL, is among SA’s four largest chicken producers.
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