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Costly Animal Feed Limiting Large Feedlot Investment

By:Nghiinomenwa-vali Erastus
Large Scale Feedlot setup is failing to attract capital investment in Namibia due to the high cost of imported animal feed from South Africa, according to the Meat Board of Namibia in their April Livestock Marketing analysis.
The Meat Board said this is why live export remains a significant marketing segment for Namibian weaner farmers, indicating also that the import cost for animal feed has made it not financially viable to set up a feedlot in the country.
“The Board reveals that this is due to the poor financial viability of large-scale feedlots in Namibia that results in costly importation of animal feed from South Africa,” said the body that regulates the meat industry through managing annual production of livestock and meat, as well as import and export control.
A feedlot sector represents an intensive production system with the goal of growing or fattening cattle and calves (weaners) until they reach slaughter weight.
Feeding at the feedlot involves high-grain/low-forage rations to backgrounded calves or yearlings until they reach a prescribed finish (fat cover) before marketing for slaughter.
Most of the cattle marketed in Namibia are sold on hoofs, mostly weaners to South Africa.
The first quarter of 2023 statistics show that of the total of 53,157 heads of cattle marketed, 30,436 heads predominantly 99.5% were weaners destined for feedlots in South Africa, and 0.5% were exported for farming purposes.
The Meat Board in April 2023 indicated that the cattle sector continues to record an improved performance with increased activity recorded at export- abattoirs as well as live exports during April 2023.
Year-on-year, a total of 25,608 heads of cattle were marketed during the month of April, an increase of 14.1%.
“The increase is partly attributed to increased exports of weaners, predominantly to South African feedlots,” the Meat Board said.
In terms of prices, the year-to-date weaner/ B2 beef ratio stands at 47.7% favourably compared to 66.2% observed last year during the same period, the Meat Board revealed.
Price developments for April indicate that slaughtering animals could be more profitable than weaner sales due to rapidly falling weaner prices that have resulted in a widening gap between weaner prices and prices paid for slaughter cattle at export-abattoirs.
Meat Board indicated the low ratio below the 64.0% benchmark “represents relatively higher producer carcass prices paid by abattoirs for slaughter-ready animals which ought to discourage the exportation of weaners and boost the production of slaughter cattle.”
Year-on-year, live weaner prices weakened by N$13.33/kg, averaging N$24.92/kg in April 2023, the lowest level recorded since September 2019.
As for the B2 beef producer carcass price dropped to N$60.60/kg in April 2023 from the level of N$62.27/kg recorded in April 2022. Year-to-date the B2 carcass price averaged N$63.29/kg by the end of April 2023.
It has also been noted that despite more meat being produced by export-approved abattoirs during April 2023, beef exports declined as more exportable meat was appropriated for the local market.
Mutton exports on the other hand strengthened during April 2023 due to increased volumes exported to South Africa and Norway by the two export-approved abattoirs.
Since the beginning of the year, local registered butchers have slaughtered 10,851 head of cattle by the end of April 2023, this is to serve the local formal beef market.
While export abattoirs have slaughtered 24,353 heads of cattle to export beef to the external market, this number of animals is, however, more than 23, 679 heads of cattle produced by the same period last year.
In terms of beef, the picture is, however, different as less beef was exported (2,5 million kilogrammes) from more cattle compared to 3,0 million kilograms exported last year from less cattle slaughtered. Email:

Nghiinomenwa-vali Erastus

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