Norwegians Eye !Uri !Khubis

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By Kuvee Kangueehi Windhoek Norwegian investors who have shown interest in the !Uri !Khubis abattoir are expected back in the country on February 22 to continue negotiations with Agri-Bank. A source close to the deal told New Era that the Norwegians are willing to buy the abattoir’s equipment and property for N$21 million. AgriBank is believed to be interested in the cash on offer after spending over N$46 million on the project. The investors, who are likely to go into partnership with local black empowerment groups, expect their partners to dig into their pockets for the remaining capital that would get the project off the ground. According to our source, the Norwegians were impressed with the state-of-the-art abattoir, which meets European standards. However, they are concerned about the quality of water at Witvlei, which is salty. The water causes clogging of pipes, which leads to severe blockages and the Norwegians were actually surprised that an abattoir of that quality was built without filters. Although !Uri !Khubis went into liquidation before it could export consignments of beef to markets in the European Union, it is believed that it has a huge potential by virtue of being situated in the Omaheke Region. According to the 2004 agricultural census, Omaheke and Khomas regions have the highest number of cattle for slaughter in the country. The !Uri !Khubis abattoir is expected to be a strong competitor for Meatco, especially for the Norwegian market. Norway is one of Namibia’s biggest meat consumers and Meatco currently exports 2 800 tonnes of beef to Norway annually. There are fears that if the Norwegians takeover of !Uri Khubis materialises, the Norwegian market would be taken. Meatco’s Corporate Communications Manager Uschi Ramakhutla acknowledged that her company expects to face competition should the deal go through, but noted that Meatco has an already established market and clients. “Of course, they will have the upper hand because it’s their country of origin but we are able to stand our ground.” Ramakhutla noted that losing the Norway market would have a considerable impact on Meatco, as the entire European market is a lucrative revenue base for the company. “Close to 70 percent of the Meatco revenue comes from Europe despite the fact that we only export 35 percent of our products to Europe.” She added that Norway represents 23 percent of the European export market. Ramakhutla also noted that Meatco would be expected to compete for the already limited number of slaughter cattle in the country, especially in Omaheke, with !Uri !Khubis abattoir. Meatco has a quota of 13 000 tonnes of beef to supply the European Union but so far has failed to meet the quota. In 2004, they only managed to supply 11 000 tonnes of beef and the 2005 figure is expected to be the same. Ramakhutla attributed the shortfall to the low number of cattle in the country. “The cattle production system has also changed and farmers are shifting more to weaner production, which are mainly exported on the hoof to South Africa.” Producing weaners appears to be more profitable for the farmers, she said. The abattoir was a black empowerment venture with shareholding spread across various organisations that represent women, farmers, and various communities in the Omaheke Region. These include the Omaheke Investment Farmers Trust (30 percent), United Women Investment (20 percent), Namibian Harvest Investment Ltd (20 percent), Tsogang (12 percent), New Horizon Holdings (10 percent) and Nawegro (5 percent). !Uri Khubis received an initial capital injection of N$46 million from the Agricultural Bank, N$5 million from the Government Institutions Pension Fund (GIPF) and another N$4 million from Namibia Harvest Investments. Comments from the Chief Executive Officer of Agribank, Leonard Ipumbu and the Norway Consulate to Namibia could not be obtained.