Milk industry feels the pinch: farmer

09 Sep 2015 13:50pm
By Patience Smith
KEETMANSHOOP, 09 SEP (NAMPA) – Namibia’s biggest private milk producer, Willie Agenbach of Goedbegin Melkery outside Mariental, says the reduced demand for locally-produced milk is a real crisis already felt by everyone in the Namibian milk industry.
The Hardap Region farmer told Nampa on the sidelines of the recently-held Keetmanshoop Show that milk farmers are feeling the pressure of a decreased demand for local milk and the probable shutting of the Namibian dairy industry.
Agenbach says he supplies 170 000 litres of raw milk per month to Namibia Dairies from 220 milk cows. He is one of 14 milk producers in the country, and employs 19 people at his milk facility.
In August this year, Namibia Dairies, a subsidiary of Olthaver and List Group of Companies, announced that the entire industry was on the verge of collapse and called for urgent intervention.
The company said globally, dairy prices were at a 13-year low due to a worldwide surplus and Russia’s ban on imports in the wake of European Union (EU) sanctions.
Increased production in South Africa and an oversupply to Namibia now translates to cheaper imported dairy products compared to products manufactured by Namibia Dairies.
Explaining why local milk is more expensive than imported milk for the consumer, Agenbach said Namibia produces of the best-quality dairy with the lowest amount of bacteria to comply with European Union protocols.
“According to international standards, milk should have bacteria of under 300 000 units. Generally, milk from Namibian farms has bacteria under 30 000 units,” he said.
The farmer further said that for the past two months, Goedbegin Melkery received a bonus of five cents per litre for its milk, which only had 20 000 units of bacteria. Keeping the count of bacteria low reduces harm to humans and the chances of milk going off, and extends the shelf life of dairy products.
In comparison, Agenbach said, South African farmers use chemicals and genetically modified organisms in their feed, making it cheaper and faster for them to produce high volumes of milk.
According to him, the milk sold in South African stores is priced higher than the same milk sold in Namibia due to the oversupply in South Africa, which has a population 23 times the population size of Namibia.
Agenbach said problems in the local milk industry were compounded by the late payment of some major chain retailers to Namibia Dairies, affecting payment to the milk farmer and further destabilising the overall cost of milk.
Namibia Dairies pays farmers between N.dollars 5 and 5,50 per litre of milk, based on the quality of the milk. Currently, all farmers reportedly receive 20 cents less than usual for a litre of milk. Suppliers took a price cut in efforts to reduce losses because the demand for local milk has dropped.
In October 2013, Government instituted interim quantitative restrictions on the import of dairy products into the country. The import restrictions were intended to provide protection to Namibia’s dairy industry, which found itself struggling to compete against, especially, South African dairy products sold at lower prices in the Namibian market.
However, this ban was lifted in August 2014, after Clover Dairy Namibia and another company importing dairy products into Namibia, Matador Enterprises, challenged the import restrictions in the High Court. Judge Dave Smuts found that the process of introducing the restrictions was “hopelessly and fundamentally flawed”.
Agenbach, who breeds with Vlaam horses in his spare time, was at the Keetmanshoop Show where five of his steeds competed in the National Championships for Friesian horses.
The main competitor with 30 horses in the competition was the Windhoek-based Mount Royal International stable owned by Karen Woermann. A number of the Woermann-horses are reigning South African champs in various categories.
Farmers Fritz and Kandas Visser from Mariental entered 13 horses.
The horse show is a regular feature much enjoyed at the annual Keetmanshoop Show. The 60th edition of the show took place from 02 to 05 September.