Livestock Marketing

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Allow me some space in your highly-rated newspaper to share and deliberate on the issue of livestock marketing from a perspective of both communal and commercial farmers. All in the farming sector would agree that the year 2006 was blessed with rain hence a bumper farming year. And the benefits were numerous. It all started with exceptionally high prices for our livestock, making the farming exercise more bearable and profitable; self-employment became a reality for all and not for the chosen few. Farmers could afford all the basic necessities. Even luxurious new cars for the first time in centuries are affordable; Agribank loans are serviced, etcetera, etcetera: what a relief from an excruciating drought that was threatening our livelihoods. The point I’m driving at is to justify the notion of a free-market system that determines prices, quality supply and demand of any commodity. The above thrives well when the Government is in pursuance of the right policies, as has been the case. However, there are some opportunists who would conduct some “feasibility studies” which lack reality and logic and confuse the whole situation altogether. To be brief and precise, I shall address the following itemized issues: presenting the situation of farmers to our great Government of the Republic of Namibia. These are: Job creation, value adding and the role of the Meat Board. Job Creation There are a limited number of abbatoirs which can employ only a limited number of people. Even with a totally closed border, not more people will be employed on the other hand, when marketing is free with partially open borders as it is now, there are: – Livestock buyers who are striving to free and open markets in our neighbouring countries and are employing many people in rural communities where unemployment has the highest rate. To take this away would take jobs away from many more. – The transport industry is employing drivers and other employees needed for all work associated with transporting live animals to the R.S.A and elsewhere. – Auctioneers like Agra, NLA and other privately-owned companies are employing many people because they have created a huge industry over time. Stages like buying handling (activities) on auction days, selling feeding licks and fodder and vaccinations are just some of the tasks if the endeavour is to bear fruit. This is laborious. The costly infrastructure and its maintainance need not be overlooked. Cognition is, however, made that farmers north of the Red line may not be benefiting at the same rate as the central, southern parts. This is where the government should place resources to bring a considerable change or consider some other options. Government must strengthen its revenue capacity from other sources and not be tempted to take from the mouth of its citizenry because of the poor advice provided to it by the so-called experts or intellectuals who are failing even worthwhile endeavours. Seeking only to be at the helm of every parastatal and milking them in excess of N$100ÃÆ’Æ‘ÀÃ…ÃÆ”šÃ‚ 000 per month. Of course, earning more than our President who shoulders the entire nation and its diverse activities. Value Added: There are many areas where value can be added without taking away value from farmers, such as the tanning of hides and skins before export and to make some products for local use. The producers want to know: where and how is value added? If the abattoirs have the exclusive right to buy and sell the meat, they are manipulating the prices and they pocket the money under the pretext of value-adding when they sell the meat. In other words, when they let the price fall, they take that amount of money away from the producer and put it into their own pockets. For instance, current sheep prices do not reflect mutton true value in the R.S.A. The producer gets much less per kilo while fuel prices, electricity feeds are on the ascent. The fall in value of our currency has been overlooked. – The abattoirs are laying down ambiguous criteria for carcasses that get more and more difficult to reach. The grading for Grade 2s and 3s is further complicated by weight restrictions. This is pure intellectual dishonesty. Then there is a huge difference in grade prices. (A farmer carried out his own research on the credibility and feasibility of these gradings – he could not find a single consumer that is aware of shopping according to grades). Also in supermarkets, there are no indications of grades and price differences on the same basis, as the abattoirs are paying the producers. This is another clever and hidden price-manipulating measure at the cost of a producer – value added for whose benefit? Carcasses outside of these grades are penalized heavily in price, making sheep-farming an unprofitable exercise. On the auctions this is not the case – the prices are much more balanced and indiscriminate – resulting in the producer getting a higher average price. This explains why abattoirs and auctioneers must be allowed to determine prices and, when regulated, it must never set a precedent for a monopoly. If the SADC objective is to establish a powerful economic bloc, it should be easy to get Namibians to work in South African feeding lots and associated industries, or a formula must be established to cover for our national loss if deemed necessary and viable. In such feasibilities, milk and honey-seekers must be excluded from giving twisted advice. With open borders for livestock marketing demand and supply price indices are likely to remain firm and healthy. When borders are closed, the abattoirs owners have the sole mandate, like it is now with the sheep prices. They enter a vast market in the R.S.A and determine their selling prices. Having let the Namibian prices tumble to the lowest ebb. Yet retail prices in the R.S.A are ever on the rise. The question is: Where does the huge difference in the RSA mutton retailer’s price and the producer’s price in Namibia go? The concept of value-adding is defeating its objectives. Isn’t it? Crooks are aware that our level of numeracy is still at elementary level and can promise heavens without being suspected for their fraudulent activities. They tarnish our leaders’ reputations because the fact that you in one way or another supported that cause, implicates you with dire consequences. Or the Government risks being labelled “corrupt with impunity” by ill-luck wishers – if wrongs are found. Remember, our leaders are burdened with the responsibility to deliver, hence any proposal presented to them must appear to be inclusive and wonderful. People, we should stand up and never be allowed to be enslaved by the so-called Direct Foreign Investments like is the case in the mutton industry. The producers are open and positive towards creating new and better markets, but why take away better markets in order to deliver to weaker markets which are bringing lower prices to the producer’s advantage rather than worsening his position? Having won the mutton war, the struggle is set on beef (weaners) and goats. Pastoral farming is becoming sustainable and viable even for upcoming farmers, as well as for resettled farmers, and can now establish themselves on these good prices. And, with more blacks buying commercial farms, it should be easier to repay Agri-Bank. A Namibian with 20 herds of cattle is equivalent to a Motswana with 100 cattle. However, Botswana is eyeing these markets on which Namibia has had an exclusive selling monopoly. Namibia, being the driest country in our region, will be unable to hold the valueless 100 herds if the current 20 are putting so much pressure on land. And our Namibia is prone to successive droughts. Mind you, the same people who are fooling and tempting us are the same who would be telling the world how corruption, bad policies have destroyed our economy with inflation having exceeded 1000%. Let the abattoirs negotiate and establish their businesses on normal marketing criteria such as demand and supply, prices and service. Government must not protect abattoir-owners by closing borders? Supply and demand have never failed to level the playground for all role-players and establishing sustainable and fair industries. The proportion of livestock being exported on the hoof and those slaughtered by abattoirs for export must still be thoroughly ironed out. The current scenario whereby one sheep is for export while 6 (six) should be slaughtered locally for export, is extremely heartbreaking. Namibia’s industrialization will not become a reality if the people remain poor with an insignificant buying power. Industries might just be white elephants. The Role of the Meat Board: The monitoring of prices – How does the board monitor prices? Are they simply waiting for faxes to come through or are they conducting their own independent research? There are already huge differences between prices given by the Meat Board and prices on ground level in South Africa. Whose interest are they serving between abattoir-owners and producers burnt by the African scorching sun? The reassurance that prices will be monitored, does not mean much if it is done as it is done currently with mutton prices – just pick up the phone and get some prices from supermarkets and butcheries in the RSA, in all provinces – and also try to buy according to grades and prices per grade as producers are being paid here at abattoirs. There is no correlation. Research and monitoring must be done independently, widely and discrectly. Mpho Wilberforce Shobo Kalahari-San Pathfinder