The Meat Corporation of Namibia’s (Meatco) fixed-price contract (FPC) for producers will be ending in April after it was introduce last year, it has been revealed.
The FPC was introduced to help farmers get to know the prices of their products (Livestock) when they are selling to the corporations during the ‘peak season’ when markets have been paying very little for livestock, manager of corporate affairs Rosa Hamukuaja –Thobias has said.
“The FPC will not continue throughout the year. In fact, the idea was not to have them during the peak season. FPC was only introduced to assist the producers in producing slaughter oxen and in future attempt to secure consistent throughput for the Windhoek Abattoir during the peak season,” she said.
She added that when the FPC comes to end in April the Meatco management will then review the entire process and make a decision if they will re-introduce it again later during the non-peak season.
“It is all for the farmers knowing the prices. When they know the prices then they will be able to plan for what they are selling and what they are expecting to receive after selling their products or material to Meatco,” she said.
Meatco purchases cattle from farmers engaged in extensive livestock farming conditions that lend unique characteristics to the cooperatives end product, which after being processed through the value chain releases a significant premium in carefully selected markets across the globe.
However, fixed prices can require more time in advance for sellers to determine the price of each product and the FPC items can each be purchased faster but bargaining could set the price for an entire set of items being purchased reducing the time for such bulk purchases treated as a whole batch.
FPC products can help in pre-determining the value of the entire inventory such as insurance estimates.