Dairy industry in the doldrums

Because of the drought of the past few years four producers have left the industry.

20 November 2019 | Agriculture

ELLANIE SMIT





The ongoing drought has hit Namibia’s dairy industry hard. A shortage of fodder has led to unsustainable feed prices and a 500 000-litre decline in production over the three months from July to September.

The difficult conditions in which the dairy industry is operating have already resulted in four dairy farmers closing operations in the last 12 months and with the Hardap Dam nearly empty, further closures are a real possibility.

The managing director of Namibia Dairies, Gunther Ling, says the impact of the drought is very serious for the dairy industry.

“Fodder shortages leading to unsustainable feed prices [threaten] the existence of not just dairy farmers but all farming operations in Namibia. Raw milk production in Namibia is significantly reduced year-on-year, while cream supply is also under pressure.”

Ling says raw milk production has declined by 1.1 million litres, or 6%, when comparing the nine-month period from January to September to the same period last year.

“The alarming part is that half of the 1.1 million litres declined over only the last three months, mainly due to the drought.”

Ling says Namibia Dairies currently procures raw milk from 14 dairy farms, including its own Mariental Superfarm which contributes up to 60% of the product.

Because of the drought of the past few years four producers have left the industry, he adds.

“It is estimated that 1 500 direct jobs are established in the local dairy industry. About ten employees are needed on a smaller dairy farm; hence the closure of four farms already means that 40 people have lost their jobs potentially.”

The decline in milk production is due to poor rainfall received this year, which resulted in unfavourable grazing conditions and reduced the availability of animal feeds.

According to Ling the exact increase in feed costs depends on which type of feed is used by producers, but the overall increase in feed costs due to the drought is about 50%.

The dairy industry is highly dependent on feed to increase milk production. In 2018, feed costs increased by 72.9%, while the producer price of raw milk was reduced twice.

According to Ling there have been no price cuts for producers this year. “There has been a price increase of 30 cents per litre since September 2018.”

Referring to the low level of the Hardap Dam, Ling said if there is no inflow into the dam by January 2020, it would have very serious impacts on fodder and water availability to dairy producers near Mariental, including the Superfarm, which would further reduce milk availability.

By the end of October the dam was only 12.3% full.

Apart from the drought, another challenge facing the industry is import competition.

Ling says no industry protection has been implemented for the dairy industry yet.

According to him the total market size for UHT milk, fresh milk and yoghurt in Namibia is 38 million litres per year. Of this, 62% is imported while 38% is produced locally.

Last year the dairy industry was in dire straits following a surge of cheap South African UHT-treated milk products into the market.

“There is no such thing as infant industry protection (IIP) for local dairy production; that was stopped in 2012. Also, the last efforts of quantitative support measures by government and industry were only valid for 12 months, ending August 2014.

“Namibian borders have been completely open for the past few years for any dairy products to enter into Namibia at any time, at any volumes, at any price. Meanwhile, neighbouring countries like Botswana, Zimbabwe, Zambia and Angola have certain trade barriers in place to protect their own local dairy industries against imports,” Ling told Namibian Sun at the time.

It was estimated last year that the total dairy volumes sold in Namibia, local and imported products alike, accounted for less than 1% of the South African market size. To put this into perspective, it means that South Africa needs only three days to produce the volume of milk that Namibia consumes in a full year.

Similar News

 

Venaani makes rainwater plea

1 day - 27 January 2020 | Agriculture

The leader of the official opposition Popular Democratic Movement (PDM) McHenry Venaani has called on people in the north to make use of rainwater to...

Tough road ahead

6 days ago - 22 January 2020 | Agriculture

The disastrous drought in Namibia over the past seven years has forced livestock producers to significantly reduce their herds. They are now faced with cash...

Katima abattoir to start with test slaughtering

6 days ago - 22 January 2020 | Agriculture

ELLANIE SMIT The Katima Mulilo export abattoir is expected to commence with test slaughtering by the end of February, if repairs...

Oriental fruit flies in Zambezi

1 week ago - 15 January 2020 | Agriculture

Oriental fruit flies have been detected in the Zambezi Region, resulting in strict control measures being implemented on the import of mangoes from Zambia to...

No new timber may be harvested

1 week ago - 15 January 2020 | Agriculture

In an update on the timber operations in the Kavango West, Kavango East and Zambezi regions, the forestry ministry has emphasised that no new timber...

Cabinet defied on Amta procurement

2 weeks ago - 10 January 2020 | Agriculture

Only the military and police are procuring their consumables through the Agro-Marketing and Trading Agency (Amta) as per a 2014 cabinet directive that sought to...

Dam levels remain low despite good rains

2 weeks ago - 08 January 2020 | Agriculture

Some inflow over past weekThe latest dam bulletin indicates Namibia’s reservoir levels are at 18.2%, less than half of last season’s 41%.ELLANIE SMIT Despite good...

88 000 livestock die in a year

3 weeks ago - 07 January 2020 | Agriculture

Over 88 000 livestock deaths have been recorded from October 2018 to September 2019 as a result of the devastating drought in Namibia. Over 56%...

Silos run empty

3 weeks ago - 07 January 2020 | Agriculture

ELLANIE SMIT Most government silos stood empty by the end of last November, with stock at only 7.33% of the total holding capacity. The Agricultural...

Household food security worsens

3 weeks ago - 06 January 2020 | Agriculture

Household food security is expected to worsen, particularly in rural areas, according to a drought report released by the ministry of agriculture.This is despite the...

Latest News

No evidence of ritual killing

22 hours ago | Crime

The police are contemplating DNA tests, if the police kitty allows, to identify the young Zimbabwean girl whose charred remains were found in a garbage...

Lightning kills 11 cattle in...

22 hours ago | Accidents

A farmer at Epingiro village in the Kavango West Region's Ncamagoro Constituency suffered a loss when lightning killed 11 of his cattle on Sunday evening....

A day in the life...

22 hours ago | People

Michelline Nawatises Samuel Mayele Nghipandulwa is 23 years old and hails from Ruacana, Oshifo. He started grade one and two at Oshoopala Combined School and...

Land question remains unanswered

22 hours ago | Opinion

We have said before that land reform in Namibia, which is currently a hot topic, should not be politicised. There is a general agreement that...

The importance of a pat...

22 hours ago | Columns

Ester KamatiWe often overlook how important it is for a person to be thanked or praised after they’ve put their energy into something which eventually...

Judges throw out shocking spliff...

22 hours ago | Justice

A N$4 000 fine or two-year prison sentence for possession of a single two-gram dagga joint worth N$20 was tossed out by two High Court...

Your future in dance awaits

22 hours ago | Youth

Ester Kamati The Ombetja Yehinga Organisation Trust has the main mandate to create social awareness through the arts and has been doing so for the...

The youth speak up

22 hours ago | Education

Elizabeth JosephYoung people all over Windhoek came together this weekend to discuss ways in which the health ministry and the government can make hospital facilities...

Grade 1 class receives hope

22 hours ago | Education

Elizabeth Joseph Many Namibian children go to school without shoes or so much as a meal to get them through the day. The children...

Load More