According to the latest Namibia Agricultural Union (NAU) research, Namibian producers earned an amount of N$3.4 billion from the sale of cattle during 2017.
This is 45% of the total agricultural income for the year which has seen a drastic increase from N$2 billion in 2016.
“It thus is critical for the Namibian economy that this industry is healthy and sustainable,” reports NAU’s Erika von Gierszewski
The vision of the LPO is that all three markets which are currently served, namely the EU export market, the local market for beef as well as the export market of live cattle mainly to South Africa is of vital importance to ensure a fair price for producers.
NAU confirmed that the LPO management last week visited the South African meat industry in order to get a better picture of the value chain, to which Namibian weaners are delivered.
The SA beef industry annually slaughters about 3 million cattle, of which 87% is A grade.
The cattle are mainly from feedlots which are vertically integrated in the total value chain and deliver a final product to the retailers.
Exports of beef from South Africa in the previous year during the drought was approximately 50 000 ton.
Due to the stabilisation of the Rand, exports are not competitive anymore and it is expected that exports will decrease in 2018 and that this export meat will have to be absorbed in the SA market.
Due to the relative low maize price, meat which is produced under intensive circumstances is in the market available at a very competitive price.
The ailing economic conditions force consumers to rather buy cheaper chicken and pork to replace beef.
Weaners however are still in high demand due to the reduction of RSA cattle herds and it is expected that the weaner prices will stay competitive for the next 2 years.
An oversupply on the local Namibian market due to emergency sales may force prices downwards on the short term.
“The LPO is very concerned about the sustainability of the export market of beef from Namibia and currently tries to make other plans,” reports NAU.
The LPO management decided to investigate how an optimal processing- and marketing organisation should be which is sustainable on long term and in which producers are directly involved and have a say.
The plans are already in progress, but a proper sustainability study must still be done. Members will be informed as soon as more information is available.