If South Africa’s beef industry wants to become a serious competitor on the world stage, it must replace exports of ‘cheap meat’ with higher-value cuts, says livestock genetics consultant, Dr Michael Bradfield. He spoke to Lloyd Phillips about the way forward for the industry.
In 2016, global red meat exports amounted to 9,44 million tons. Brazil led the way, exporting 1,85 million tons, or 19,6% of the total. South Africa ranked 15th, at 60 000t, or 0,64% of the world total. At the same time, it became a net red meat exporter for the first time.
Currently, however, South Africa supplies mainly the commodity, or cheap beef market, and not the high-end, value-added beef market. This needs to change, says international livestock genetics consultant and CEO of AgriBSA, Dr Michael Bradfield.
The recent drought showed how crucial it was for the country’s beef industry to stop focusing on exporting only the cheaper cuts.
“By exporting higher-value cuts, our industry can protect itself from shocks to farm income caused by droughts and other environmental impacts, local currency depreciation, inflationary impacts on local consumer spending, and any oversupply in local beef leading to price pressures,” says Bradfield.
Namibia’s beef weaner price, for example, would be 30% lower were it not for exports, while Botswana’s beef industry generates 80% of its total income from exporting 20% of its total beef production.
Moreover, although South Africa’s middle class continues to grow, national demand for beef is stagnant.
“This is all the more reason for the SA red meat industry to eight weaners to generate enough income to buy the same bull.
In addition, earlier this year, US farmers achieved their local currency equivalent of an average of R64,05/kg for beef carcasses, those in Australia received R67,26/kg, and those in China received a minimum of R82,50/kg. South Africa’s farmers were paid a mere R45,83/kg.
A lower price is a common trend among developing beef-producing countries such as Ethiopia, Sudan, India and Pakistan, notes Bradfield.
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This story is from the 15 September 2017 edition of Farmer's Weekly.
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This story is from the 15 September 2017 edition of Farmer's Weekly.
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