20.3 C
New York
Tuesday, May 30, 2023

Buy now


South Africa’s blackouts hurt economy in unexpected ways

“We kill chicken 24 hours a day,” says Izaak Breitenbach of the South African Poultry Association (SAPA), an industry body. At least that’s the plan. Typically 4 million poultry are sent to slaughterhouses every day. But he said the power outage imposed by state-owned utility Eskom was “an absolute disaster”, causing slaughterhouses to stop slaughtering. The strange and powerful impact on the industry hints at the enormous costs of power outages in other sectors of the country’s economy.

Hear this story.
Enjoy more audio and podcasts iOS or android.

Your browser does not support

The question of which came first, the chicken or the egg, has nothing to do with poultry producers. All they see is a long value chain. They raise hens and their eggs are brought to the hatchery. The hatched chicks are transferred to broiler farms, a jarring prelude to the slaughterhouse. Chickens are usually slaughtered at a precise, young age (34 days old) to satisfy buyers.fast food restaurants such as KFC There is a tightly controlled process: if the wings or legs or breasts are too large, the allotted cooking time is not enough and the meat is raw. South African consumers are often too poor to afford large birds, so retailers also encourage producers to slaughter birds earlier than in richer countries.

Last year, the total amount of “load shedding”, to use a local euphemism, was more than double that of previous years. In 2023, there is little light at the end of the tunnel. South Africans expect to live without electricity for six to ten hours a day. This means a quarter fewer chickens are slaughtered, with two direct effects. First, farmers are raising fewer chicks because there is no room for broiler farms. Second, the 1m or so of poultry that is spared every day is getting bigger and bigger.They are too large, in fact, for such KFCmeaning lost sales for the chicken company.

Power outages also mean higher prices. This is partly due to reduced supply. But this is also a consequence of higher costs. One farmer said he spends 800,000 rand ($47,000) a day on fuel for his generators.

The poultry industry is just one of the industries affected by load shedding. Mining output fell year-on-year for ten consecutive months. Small businesses serving millions of poor consumers, mostly in black townships, are closing down. Shoprite, a large grocery chain, predicts it will spend 1.2 billion rand a year on diesel to keep lights on, equivalent to about a fifth of its annual profit, if the outages persist. Economists believe the outage could tip the country into recession in 2023.

There were other unintended consequences. In parts of Johannesburg, taps have run dry because the water company cannot pump water without power. As traffic lights dim, motorists often find themselves stuck in jams on congested roads.

President Cyril Ramaphosa is considering declaring a national disaster over the power crisis. But South Africans have lost faith in the ability of the ruling African National Congress to fix Eskom, which has suffered for years from corruption, crime, mismanagement and failure to maintain its coal-fired power plant. As long as politicians act like headless chickens, there will be fewer and fewer real politicians.

Related Articles


Please enter your comment!
Please enter your name here

Stay Connected

- Advertisement -spot_img

Latest Articles