Growing the livestock industry for prosperity
The price Meatco pays producers is on par with other big world players in the meat industry, such as New Zealand, Australia and Brazil.
01 July 2020 | Agriculture
It is paramount to protect the long-term sustainability of the Namibian meat industry.
This is according to Meatco's executive for marketing and sales, Andre Mouton, who recently made a presentation at a seminar held by the Meat Board of Namibia.
The theme of the seminar was 'Regenerating a Balance and Growing the Livestock Industry for Prosperity' and forms part of concerted efforts to revive the industry after years of unprecedented drought conditions. Mouton's presentation focused on Namibia's competitive disadvantages, such as the size of production capacity, distance to the various markets, high-level requirements from the various stakeholders in the value chain, lack of focus and trust experiences within the agricultural sector and consistent supply.
Namibian farmers have various marketing channels available like the marketing or exporting of live animals to South Africa, marketing to the Northern Communal Areas (NCAs) and exporting to other regional markets such as Angola, and exporting to international markets.
According to Mouton, this remains a fundamental strength for Namibia compared to Botswana's market, which only has one channel that ultimately also sets the price.
He said farmers need to have access to various channels that compete fairly for their livestock. A lack of fair competition will cause the power balance to reach a tipping point, where a single channel will dictate the price entirely to its benefit.
“Thus, it is the industry's responsibility to maintain and strive for a balance in the various channels to maintain long-term price stability for the Namibian cattle producer.”
Mouton further said the price Meatco pays producers is on par with other big world players in the meat industry such as New Zealand, Australia and Brazil.
According to him, the global market has high-volume premium hindquarter markets and these are the European Union, the United States of America, China, Australia and South Korea (Pacific Rim).
The rest of the world trades on the 'global price', as evidenced by Brazil.
Mouton said that the USA and Pacific Rim countries are predominantly fat beef markets and Namibia's meat products are too lean for these markets.
“Therefore, we target more niche market sectors, which are hormone-free, require free-range animals and natural… beef to sustain the Namibian beef industry. We cannot move away from optimising local value-addition because there is a direct correlation between Meatco's market share of the livestock numbers and the livestock sector's contribution to the gross domestic product (GDP).”
Mouton recommended that, as an industry, Namibia should focus on improving the utilisation of natural resources in line with the ecology to enhance production, maintain a balance between marketing value chains to ensure sustained value and ensure proper extension to align production with the available resources, consistently.
“Maximising the use of Namibia's natural, unique characteristics in marketing efforts would ensure maximum value creation and maximise the industry's contribution to GDP.”