Meatco Hits Back at Roux

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By Catherine Sasman

WINDHOEK

Meatco Chief Executive Officer, Kobus du Plessis, says Wallie Roux’s assertion that the company has been unable to come up with “tangible results” is “blatant untruths” and a “malicious attempt at discrediting” the company.

Wallie Roux, in an interview with New Era published yesterday, said Meatco, under the leadership of Du Plessis, has yielded “minimal” results, showing “lack of insight and initiative to the changing international market environment”.

Du Plessis hit back, saying that no real market development was initiated and driven by Roux in his capacity as market researcher at Meatco, and that Roux, in the position he held until October last year, was “fully aware of the outstanding value of the European markets through the preferential access Namibia currently has”.

“No viable alternative markets or plans have been proposed by Mr Roux – this would leave the beef as well as the fishing industry with major losses that neither would be able to bear without drastic restructuring. Industry studies confirm this. Mr Roux’s reasons for his singular criticism of Meatco and myself is unknown to us and his biased and untrue utterances are most unfortunate as we should be working together, for Namibia, to maintain and develop the best markets in the world, which include the European markets,” said Du Plessis.

Correcting some of the “untruths” stated by Roux, Du Plessis said Meatco over the 18 months since he took up the position as CEO had managed, on the lowest cattle numbers in recent history, to pay farmers N$59 million more in 2006/07, and more than N$55 million so far in 2007/08, “more than the equivalent South African prices whilst showing a group profit in this period and improved assets and quality”.

This, he said, was despite the financial forecast – at lower producer price premiums – in June last year that showed a projected loss of more than N$45 million.

“The actual ‘tangible’ results were more than a ‘minimal’ improvement as stated by Mr Roux!” said du Plessis.

Moreover, he said, Meatco has developed a completely new marketing and branding strategy with its new partners in Europe and South Africa.

He said the results were clear to be seen with Namibian-marked Certified Free Range beef sold in the leading quality food retail group, Woolworths, in South Africa, and much better performance in European, Norwegian and Swiss markets.

He reported a major improvement in performance in the Norwegian market worth approximately N$30 million to Meatco last year.

“Mr Roux’s allegations about Meatco’s lack of insight and initiative in terms of the international markets is utter nonsense; our actions and market developments, in a very short space of time, demonstrate that. This is in contrast with the period prior to 2006,” maintained Du Plessis.

“The fact is that the European markets represent among the best markets in the world for high-value steak cuts and is a market where we can differentiate our brand and get a further premium.”

He said the company has already adapted all its quality systems and plants to comply with US requirements and that it is waiting for government agencies to complete the approval process which would allow it to export to the US.

Furthermore, he said, Meatco has been developing trading connections with Dubai and Singapore and Indonesia. Meatco has export approval for Dubai.
As a small, high-cost producer of meat, Du Plessis said Meatco cannot compete with countries like Brazil, and therefore compete in niche, high-value markets where it can differentiate its products.

With low slaughter numbers over the last two years, Meatco is operating at just over half its capacity, but managed to retain its staff, pay higher prices than those in South Africa to farmers, subsidised losses in the northern areas and still show a surplus, Du Plessis said.

“The point made was that if the superior returns are not maintained from the EU market, we would not be able to continue doing that at these low volumes – there was no threat, it was stating the obvious reality and the other affected industries and businesses would be similarly affected. We also made it very clear that Meatco respects the government’s overall strategy and position,” said Du Plessis in response.

He said Meatco would focus on means to reduce the anticipated losses through improving revenues and reducing costs. Its pricing strategy of paying maximum, sustainable prices to producers in Namibia would remain a priority, said Du Plessis.

“Mr Roux has deemed it fit to singularly attack Meatco and myself personally, using untruths, when the much larger reality faces not only Meatco but all fishing companies, as well as the other meat exporting companies in Namibia, plus the significant benefits that the grape exports would lose. He has chosen not to mention the positive initiatives Meatco has started, nor any of the strategies Meatco has put in place to survive and add value.”

Roux’s response to Du Plessis was: “For those who are interested, please read the latest edition of INSAT, Issue 11, December 2007 – Namibia Country Focus, published by the Southern Africa Global Competitiveness Hub in Gaborone, Botswana, available at www.satradehub.org/index.php?id=1090.”

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