Drought and lower exchange rates headache for farmers

13 Oct 2015 12:40pm
WINDHOEK, 13 OCT (NAMPA) – The drought of 2013 and 2015 had severe consequences for local farmers as the quality of cattle slaughtered during this year alone has deteriorated.
The animals' overall weight, body condition, as well as grading have deteriorated tremendously, the Chief Executive Officer of the Meat Corporation of Namibia (Meatco), Vekuii Rukoro says.
In a media statement issued on Friday, Rukoro said Namibia and the whole of southern Africa are experiencing a follow-up drought year that is in many areas worse than the 2013 drought.
Rukoro in the same statement provided insight on the impact of the exchange rate on producer prices.
“This had a negative impact on the composition and quality of cattle slaughtered during the 2015 year in terms of overall weight, condition as well as grading. The overall quality of cattle in comparison to the prior year, deteriorated,” he cautioned.
The quality deteriorated in terms of an increase in Grade Zero to Grade 1 fat of 21.4 per cent from 26.01 per cent during 2014, compared to 31.57 per cent during 2015; and a decrease of 6.67 kilogramme in terms of average carcass weight from 243.73 kilogramme per carcass during 2014 to 237.06 kilogramme per carcass during 2015 respectively – excluding feedlot A grades.
With regards to Meatco’s foreign exports, Rukoro raised the concern that the company experienced a decrease of approximately 10.28 per cent in actual sales prices in Euros within the Norwegian market alone.
Meatco has been allocated 1 250 tonnes of the Norwegian beef export quota of 1 600 tonnes in 2015. This amounted to 78.1 per cent of the total available quota.
Witvlei Meat has a quota of 350 tonnes.
Rukoro noted that Namibian producer prices did decrease as a result of changes in retail prices; changes in exchange rate; and changes in product mix. However, the overall producer prices did not decrease at a similar rate as experienced in terms of sales returns.
“The overall producer prices decreased by only four per cent year on year, as opposed to the approximately 15 per cent decrease experienced in most markets. The negative impact of the factors stated above was mainly mitigated via product re -direction between various markets specifically from South Africa to Europe, and from Europe to the United Kingdom.
'It is also prudent to mention that the current percentage of sales returned to producer’s amounts to 63.67 per cent against the average of 56.36 per cent reported for the same period during 2014,” Rukoro added.