October - December 2016 | Price: N$ 26.50 | Vol 1, Issue 4
Namibia to Harvest More than 40 000 Tonnes of White Maize A Leading Journal In The Namibian Agriculture Industry
SA & Namibia most food secure 5
Barley project to bag 1800 tons by end of 2016 11
Zimbabwean Govt to Import 1,7 Million Tonnes of Maize 26
EDITORIAL NOTE
Growing sustainability, one crop at a time The national rice project is expecting a yield of more than 350 metric tonnes this cropping season.
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s the country fights off the effects of the drought in southern Africa, Namibian Farmers’ produce is showing growth not only for the country’s sustenance but also in export capacity. Opportunities in the agricultural sector look promising across a number of fields, with increased tonnage expected for potato and onion produce. Further afield in local barley production, a substantial 377 hectares are under irrigation this year after the project was piloted in 2010. A bright future lies ahead with an expected 1,800 tonnes of raw barley to be harvested by the end of the year. Hopes are high
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that the barley planted results in a good quality harvest. Rice is also looking positive. The national rice project is expecting a yield of more than 350 metric tonnes this cropping season. Rice that is currently available for commercial sale will service both the national and international market with the Chinese already placing orders. On the international trade front, Meat Corporation of Namibia has accessed new markets in the USA and China, which are expected to bring producers maximum prices for exporting boneless raw beef products. Both chilled and frozen boneless meat products can be exported to the
USA and approval from China to start beef exports has been granted. Meatco will be the first African country to export free range organic beef-in-bone exports to China. Although forecasts are looking positive, farmers have been struggling because of the drought. In aid of benefitting 70 local farmers, Standard Bank has committed to a N$450,000 cash injection for the purchase of much needed fodder. The agricultural sector sustains an estimated 70% of the country’s population and is one of the key earners of the foreign currency for the local economy.
The Namibian Farmer | October - December 2016
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The Namibian Farmer Magazine is a quarterly professional Farming for the Namibian Farming. With a decent print run of 3850 copies per issue and a magnificent online presence, this magazine remains the preferred source of Namibian Farming news both locally and internationally
October - December 2016 | Price: N$ 26.50 | Vol 1, Issue 4
Publisher : Evans Mumba General Manager: Audrick Chigiji Editor: Jacob Botha: editor@namibianfarming.com Writers Cris Muyunda Vincent Rukoro
Namibia to Harvest More than 40 000 Tonnes of White Maize
Ndama Nakashole Tony Naruseb Nel Coetzee Graphics and Productions Merlin Wilson (Pty) Ltd Rekai Musari Mutisi– Layout Advertisement Sales Donald Mumba: donaldc@namibianfarmer Similo Ngwenya: similon@namibianfarming.com James Mkhize: jamesm@namibianfarming.com Kapingo Mulenga: kapingom@namibianfarming.com Emai Address: info@namibianfarming.com Website: www.namibianfarming.com Information, Database, Archive and Distribution Management Subscription and Sales Administrator Hazel Mukwamba l Elise Lusungo: Published By: MTI Media Physical Address: The Namibian Farmer 15 Veronica Street Ludwigsdorf, Windhoek Postal Address: P.O Box 136, Windhoek, Namibia Tel: +264 81 265 2004 l Fax: +264 81 265 2005 l Email: info@mtimedia.co.za Website: www.namibianfarming.com
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The Namibian Farmer | October - December 2016
A Leading Journal In The Namibian Agriculture Industry
SA & Namibia most food secure 5
Barley project to bag 1800 tons by end of 2016 11
Zimbabwean Govt to Import 1,7 Million Tonnes of Maize 26
Contents NEWS BRIEFS Poor beneficiary selection hampers land reform in South Africa - Agri SA : ............................................... SA agriculture to benefit from EU trade deal : .............................. SA & Namibia most food secure : ........................................................ Swakara a high-end luxury product – Klein : ..............................
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COVER STORY Namibia to harvest more than 40 000 tonnes : .............................. 8 HOME NEWS Agronomic board adds more to the pantry : ................................... Barley project to bag 1800 tons by end of 2016 : .......................... Emergency fodder for 70 farmers : ................................................. Export of weaners to commence : ................................................. Kalimbeza Rice targets 350 tonnes : ................................................. Major step to staple food fortification : ............................................. Meatco readies for exports : .................................................................. REGIONAL NEWS Scientists develop framework : ............................................................. South Africa’s food price inflation increases : ................................. Tanzania to get two new multi-million dollar sugar plants in a quest to avert shortages : ................................................ Zambia to maintain maize export ban in 2016 : ............................ Zimbabwean Govt to Import 1,7 Million Tonnes of Maize : ......
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INSIDE NAMIBIA Inside Namibia’s stud-breeding industry : ........................................ 24 Keeping track of livestock production profitability : ..................... 26
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NEWS BRIEFS Poor beneficiary selection hampers land reform in South Africa - Agri SA
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outh Africa’s land reform process was in the spotlight at the recent Agri SA Congress in Gauteng.
Issues such as land ownership and beneficiary selection were highlighted as key issues preventing SA from achieving its land reform targets and creating a new generation of successful black farmers at the congress. Grain SA vice-chairperson Preline Swart said land reform beneficiaries need the assurance that title deeds for the farms they receive are registered in their names. “Without this farmers have to remain dependent on the government and we can’t develop farmers in this way,” he added. Ernest Pringle, chairperson of Agri SA’s Agriculture Development Policy Committee, said that poor beneficiary selection must also be addressed: “We must ensure that the right people are placed on land for the right reasons." The current land restitution process has led to many commercial farms becoming unproductive. Masiphula Mbongwa, ministerial advisor at the Department of Rural Development and Land Reform, said this was a major concern for government: “When the process of restitution takes place production should not be hampered and at the end of the settlement production should be the same or have increased.”
SA agriculture to benefit from EU trade deal
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new trade deal will see improved market access for more than 30 South African agricultural products to the European Union (EU).
The deal would also eventually see the phasing out of export subsidies for EU products heading to SA and four other Southern African countries that are, so far, part of the agreement. A statement by the European Commission said Botswana, Lesotho, Namibia, Swaziland, and SA, had ratified the Southern African Development Community – EU Economic Partnership Agreement (SADC-EU EPA). “The EPA takes into account the different levels of development of the partners. It gives Botswana, Lesotho, Mozambique, Namibia, and
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Swaziland duty-free, quota-free access to the European market. South Africa will also benefit from enhanced market access, going beyond its existing bilateral arrangement with the EU,” the European Commission said. Sidwell Medupe, spokesperson for SA’s Department of Trade and Industry (DTI), said the SADC-EU EPA would give SA preferential access for about 99% of the products exported to the EU, of which 96% would be not be subject to customs duties or quantitative restrictions. SA gains improved EU access for wine, sugar, ethanol, flowers, some dairy products, fresh fruit, canned fruit, fruit juice, and yeast, and also has duty-free access for 150 000t of sugar, while the existing wine quota will increase from 50 million litres to 110 million litres with flexibility on size of the containers. A total of 80 000t of ethanol will also have duty-free access to this market, Medupe explained. In addition, he added that the SADCEU EPA will improve the protection of geographical origin for products such as Rooibos, Honeybush, and Karoo Lamb. “The so-called cumulation of origin will, for example, make it possible to apply discount tariffs on the EU border for fruit harvested in one country of the [SADC] region and [has] then [been] preserved and canned in another,” the European Commission said. The preferential access which the EU currently has to the SA market will be extended to include agricultural products such as wheat, barley, cheese and pork.
SA & Namibia most food secure in Sub-Saharan Africa - Möller
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peaking at the 70th Namibian Agricultural Union (NAU) congress in Namibia, Johannes Möller, president of Agri SA, said that South Africa and Namibia were the two most food secure countries in Sub-Saharan Africa. Möller said that Agri SA and NAU shared similar challenges, including the uncertainty of state policies. He also said that investors were increasingly aware of the lack of state support, which could lead to a decrease in investment. “The agricultural value chain adds between 17% and 20% to the South African economy. Despite this, government does not support the industry in times of need, such as the current drought,” he explained.
He added that both countries would be well advised to pay more attention to the informal economic value chain. “The informal value chain is part and parcel of our economy. For too long we have ignored this important sector of the market.”
Swakara a high-end luxury product – Klein
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n the month of August, Agra sold all the Swakara pelts it has sent to the Copenhagen Fur auction in Denmark but the average price came down by 4% mostly due to a stronger Rand. The average price per skin decreased from N$485.96 in April this year, to N$466.25. The pelt offer consisted of 30,702 black, 9334 white, 3137 grey, 631 brown, 2117 spotted and 505 diverse pelts.
The top white Swakara fetched N$1823.81 (DKK 840) for a lot of 50 KF Selected Extra pelts, purchased by Etherion Furs from Kastoria, Greece. The top black pelts fetched N$1780.38 (DKK 820), for a lot of 68 O Light Selected Extra pelts, bought by Katharina Hasse from Russia. The pelt offer was bought by 27 buyers with other prospective buyers bidding, but not being successful. The biggest buyer of Swakara was the company Morisco from Denmark which purchased 13,203 pelts. The Danes were followed by buyers from Greece with the agents from England in third place. More Chinese customers were visible at the inspection and auction, and 2110 pelts for China were bought through agents. Mr Arnold Klein, Agra’s CEO, who attended the auction noted that Swakara remains a high-end luxury product. “As evident from the auction house, white pelts are still in demand but at lower prices for the top pelts. However, the prices of black and spotted pelts increased slighty,” he explained. On the auction results, Klein said: “Swakara perfomed well, considering that the overall fur market situation is still very difficult due to the global economic challenges experienced by Russia, Greece and China.” The top Namibian producer is Karasberge Karakoel Stoet Wit, who achieved an average price of N$856.04 for 304 pelts. The top South African producer is LJ Kotze from Groblershoop who sold 574 pelts at an average price of R606.74.
The Namibian Farmer | October - December 2016
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THE RELEVANCE OF A FLOPPY SPRINKLER OVERHEAD SYSTEM IN AGRICULTURE TODAY All plants flourish with natural rain. Rain at the appropriate time still remains the best, most economic and most welcome form of water application to crops. Unfortunately, this option is not controllable by farmers and we are dependent on irrigation technologies to grow our crops.
and performance is enhanced by applying precision agriculture techniques. The use of moisture probes for example, has become a great contributor towards accurate irrigation.
In present day agriculture we are faced with challenges such as droughts, increasing input- and operational costs and the impact of our actions on the environment. Furthermore, increased yields are required to ensure economic success for farmers.
Free movement of large farming equipment under the system
Potatoes under the system in Limpopo province, South Africa Improved farming methods play a pivotal role in optimising yields. One of these farming methods, Precision Farming, is becoming a popular and significant farming method. Precision Farming allows for intensive analyses of various relevant factors and through this increased knowledge, farmers are guided to make more informed decisions. Achieving optimal yields with an irrigation system requires understanding of the plant physiology and recognition of the importance of effective management,
Hand-in-hand with the farming method is the irrigation system used. When considering the above factors, the Floppy Sprinkler Overhead System is the ideal system to choose. It is an effective tool to implement Precision Farming techniques. Recently, yields of 21 tonnes per hectare of maize and 12 tonnes per hectare of wheat have been achieved in Jan Kempdorp under the Floppy system. The larger droplet of the Floppy Sprinkler has a stable distribution pattern, giving it a significantly higher Coefficient of Uniformity and significantly higher Distribution Uniformity (WRC Report No. KV 119/99). The South African Water Research Council evaluated the Floppy Sprinkler and found it to be on average 30% more effective than a movable impact sprinkler. At daytime with higher temperatures and wind, the Floppy Sprinklers were 88% more effective, with average application efficiency of the system just short of 90%.
Š Arnold K Chinyemba, Arnold’s Designs, 2014 (210X297mm advert for Floppy Sprinkler)
The Floppy Sprinkler Overhead Irrigation System is a permanent structure erected five meters above the ground with poles spread 75 meters apart, and therefore allows for free movement of large tractors and farming equipment - even harvesters - under the system.
frost protection to the crop, preventing plants suffering from leave scorching, browning and even total plant death.
The oldest Floppy Overhead System has been in operation for 27 years. Maintenance is minimal, as the sprinkler and system have no moving or wearing parts. Treated poles have a lifespan of 50 years. The Floppy Cable Lite system - lower in cost - is three meters high and still adequate for lucerne and pastures. Cost of the Floppy Overhead system compares favourably to that of pivot systems twenty hectares and smaller and when managed effectively to achieve increased yields, it becomes a very attractive and excellent long-term option. The system offers an economical solution for Pivot wasted land, as well as for any form and size of land. Each design is unique, exactly according to the land layout and the farmer's requirements. Different crops can be grown on different blocks, and the system can be expanded over a period of time. The unique flow controller makes irrigation on steep slopes possible.
Ideal for any land layout & Pivot Fall-out corners Accurate application of fertilisers and pesticides through the system reduces the risk of soil- and water degradation, and can be applied even with high crops of 2 meters like maize. The Floppy Overhead Cable system has been used for large systems, with a project in Sudan reaching over 5,000 hectares of successful installation to date. In conclusion, Floppy Sprinkler (Pty) Ltd drives prosperity into the future by equipping the farming business with a successful solid set system to manage current and future land- and water risks, boosting overall productivity. A well managed Floppy Sprinkler system offers lower water consumption, lower labour costs and lower maintenance with a significant increase in yield and quality.
Crop- and cattle cooling in Australia Other benefits of the system include frost protection, crop- and livestock cooling. Crop cooling on production has a significant effect and contributes to creating a micro climate which secures optimal growth. At temperatures above 30 degrees Celsius, a plant protects itself by partial or total stomatal closure. Similarly, during heat stress periods cows reduce their feed intake, resulting in 10 to 25 per cent lower milk production and decrease in milk fat percentage. Running short irrigation cycles at the right time provide
We recommend that a professional installer, accredited by Floppy Sprinkler, is used for the erection of all Floppy Sprinkler systems. For more information, specialised advice or a quotation, contact :
Floppy Sprinkler
Tel: +2713 752 4252 Christo Theron at +27 82 801 3680 or Johann Hiemstra at +27 82 8500 100 or www.floppysprinkler.com.
COVER STORY
Namibia to harvest more than 40 000 tonnes of white maize Given that the exceptional decline in white maze production in Namibia’s dryland maize areas in 2016 was largely a result of the drought as opposed to economic considerations, maize producers and the Namibian Agronomic Board (NAB) are cautiously optimistic about a rather strong recovery in 2017 and up to 2020, according to Antoinete Venter, administrator of the NAB.
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amibia is expected to produce 45 050 tonnes of white maize – the staple diet of most Namibians – at the end of the harvesting season after yet another drought that impacted severely on early planting, according to the latest forecast by the Namibia Agronomic Board (NAB).
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The latest preliminary report, issued by NAB recently, says the dry land production areas of the Maize Triangle and environs will contribute only 7 219 tonnes of white maize due to a severe dry spell in the planting season. The centraleast areas near Summerdown will contribute 2 647 tonnes and the Zambezi Region 950 tonnes.
The Namibian Farmer | October - December 2016
The ten local millers have so far received 31 706 tonnes of white maize with 16 756 tonnes taken in by Namib Mills and 5 820 by Goal Maize, and the remaining eight smaller millers making up the total intake of 31 706 tonnes. Irrigation areas will make a total contribution of 34 234 tonnes with Kavango Region lead-
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COVER STORY
dependent on weather expectations throughout the planting season until the end of March 2017. Prices will then tend to stabilise as the harvest of 2017 nears. Given that the exceptional decline in white maze production in Namibia’s dryland maize areas in 2016 was largely a result of the drought as opposed to economic considerations, maize producers and the Namibian Agronomic Board (NAB) are cautiously optimistic about a rather strong recovery in 2017 and up to 2020, according to Antoinete Venter, administrator of the NAB. The weak overall harvest will translate into Namibia having to import some 140 000 tonnes of maize to fill the gap in the market due to poor rainfall in the current planting season. Since 2013, Namibia had to on average import some 200 000 tonnes of cereals to feed hungry mouths and this year the figure of people directly dependent on government drought food aid has jumped to 700 000 people. ing the way with 17 007 tonnes. Hardap and environs will deliver 6 270 tonnes to bring the total to 45 050 tonnes. The latest estimate shows a slight increase in the previous one done in August when only some 34 000 tonnes were expected. The price of white maize has been consistently above N$4 000 per tonne this season. Local Namibian intentions to plant were lower than previous years as the local producers were exposed to adverse droughts for the past four years. This had a tremendous effect on the producers’ financial ability to be exposed to such risks again, says Namib Mills and Namib Poultry CEO Ian Collard. This must also be seen in light of the very slow
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process and inadequate drought relief received from governmental bodies. Local dryland producers are unable to insure against drought, as insurance companies perceive the risk to be too high. This, however, is detrimental for dry-land planting under the current drought-relief regime. The scheme does not facilitate the needs of commercial farmers. In the longer term this will lead to lower dryland planting and therefore lower national harvests. The good news, however, is that price decreases on maize meal can be seen in future up to the next harvest, as prices are coming down on the expectation of better rain. This situation will however be exposed to volatility
Namibia’s 2015 maize crop was 44 percent lower when compared to 2014’s (above average) output, according to figures released by the Integrated Regional Information Networks (IRIN). It noted around half of all dry land commercial farmers experienced total crop losses as a result of the drought and high temperatures. According to the UN World Food Programme (WFP), South Africa suffered the worst drought in more than half a century, saying the outlook is “alarming”. “The SADC region is ill prepared for a shock of this magnitude, particularly since the last growing season was also affected by drought. This means depleted regional stocks, high food prices, and substantially increased numbers of food insecure people,” the UN agency added
The Namibian Farmer | October - December 2016
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HOME NEWS
Agronomic board adds more to the pantry
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he Namibia Agronomic Board (NAB) in its annual findings said that the special controlled products scheme has increased the tonnage of locally produced potatoes and onions for the current financial year and currently have plans to extend the scheme. Harvested tonnage for onions and potatoes, which are considered controlled products increased from 7,911 to 9,328 tonnes and from 13,308 to 15,619 tonnes each, including last years exports, while other popular products such as cabbage, carrots, tomatoes, peepers, sweet potatoes and beetroot will be added to the scheme in the near future. Locally, imported washed and unwashed potatoes for 2015 stand at 19 125 tonnes and 2 715 tonnes of exported unwashed potatoes when seasonal surpluses exceed the market demand. The potato market continues to be an opportunity for producers, although Namibian production conditions are challenging during months of high temperatures and frost. Coupled with the Market Share Promotion (MSP) initiative which compels importers to
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buy a given percentage of local produce before being able to import has also led to an increase in local production from N$549 million to N$621 million. A Special Potato and Onion Agreement between the Potato and Onion Producers Association (POPA) and the National Association of Traders in Fresh Produce (NATFP) made a significant contribution towards increasing local production as well as local market access. In addition to the MSP rules, the agreement makes provision that during the times when there are sufficient quantities of locally produced potatoes and onions available, a closed border period is declared. During a closed border period, these commodities may not be imported. This provision allows for local producers to sell their produce and only once all locally produced commodities have been marketed are imports allowed. Importers therefore have to apply for a Special Potato and Onion import permit in addition to the normal import permit for mixed horticulture products.
that proposals by the line Ministry to make changes to the Agronomic Industry Act are in the advanced stages. “This will see the NAB and the Agro Marketing Trade Agency (AMTA) merge as a single entity,” he added. The two state owned enterprises will implement and foster the promotion of local imports locally and for export markets. “The Board convened a stakeholder forum for the industry to critically and objectively evaluate the Act amendments for the whole industry to submit “one-voice” proposals to his office.” Brock said on the submissions made to the MAWF office. He added that it was later agreed after independent and profession consultations to retain the original regulatory functions of the board. “I am proud to state that our Board meeting and its various focused Commodity and other Advisory Committees have continued to function efficiently and effectively under the exemplary hand of our Chair, Kobus van Graan and other Board members,” he said.
NAB, CEO, Christof Brock in the report said
The Namibian Farmer | October - December 2016
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HOME NEWS
Barley project to bag 1800 tons by end of 2016 This would allow us to plant more barley next year. Provided we achieve product quality and yield requirements, we aim for a year-on-year increase of +- 1500 hectares per annum.”
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he fields are planted and the silos are ready. The undertaking to produce local barley has progressed from a pilot project in 2010 to a substantial 377 hectares barley under irrigation this year. The project is run by Namibia Breweries Ltd with the aim to reduce its dependence on imported barley. The barley is grown in two locations east of Rundu and irrigated with water from the Kavango River. The future of the home-grown barley project by Namibia Breweries Limited (NBL) looks bright with 377 hectares of barley planted so far according to Project Manager, Martin Krafft For the year to date, 257 hectares of barley have been planted at Ndonga Linena, 90km east of Rundu and 120 hectares at Shadikongoro, 200 km east of Rundu. The project expects to harvest about 1800 tons of raw barley by the end of November. According to Krafft, this year the government availed 380 ha. of existing irrigation land to the project specifically for the production of barley. The project is guided by a Memorandum of Understanding signed between the Ministry of Agriculture, Water and Forestry; the Agriculture Business Development Agency as managing agent for the Green Schemes
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projects, and Namibia Breweries Ltd. This week, the Breweries said “this year is the first year of the 10-year Barley Industry Development Plan (BIDP) which is governed by the MOU and the acting Technical Committee, thus far proving to be a successful Public-Private-Partnership (PPP).” Krafft said that he remains confident about the future of home-grown barley due to the good collaboration between AgriBusDev, the Farm Managers of Shadikongoro and Ndonga Linena Agricultural Project as well as the O&L internal expertise of Mr. Floris Smith. Namibia Breweries Ltd is a subsidiary of the O&L Group. Krafft said,“This is a very positive project kickoff. Hopes are high that the barley planted results in a good quality harvest for NBL and decent returns for AgriBusDev as well as the small scale farmers involved. This would allow us to plant more barley next year. Provided we achieve product quality and yield requirements, we aim for a year-on-year increase of +- 1500 hectares per annum.” “Eventually, the goal is to gradually replace the import of about 40,000 tons of malted
barley. NBL intends to source all raw barley locally. This, however, requires investing into a local malting plant which seems to be feasible when the project reaches the benchmark of harvesting 15,000 tons of local raw barley per year,” explained Krafft. Meanwhile, NBL aims to harvest 12,000 hectares of raw barley over the next ten years. It has imported malted barley as a key ingredient for most of its current beer brands. NBL initiated and invested in barley trials in 2010 with the intent of establishing a local barley industry that would create jobs and support the local economy as well as the local agricultural sector in rural areas. Since the commencement of the barley trials, Namibia Breweries Ltd has invested more than N$5, 5 million into the barley project for planning and execution. This includes buying seeds, planting, laboratory work and brewing trials, as well as shipments and transport. This excludes the product innovation work that has gone into developing the new brand, King Lager which is the first local beer to be brewed using homegrown barley.
The Namibian Farmer | October - December 2016
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HOME NEWS
Emergency fodder for 70 farmers
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n heeding the government’s call for corporates to assist farmers during the country’s prevailing drought predicament, Standard Bank earlier this month announced a N$450,000 cash injection for the purchase of much needed fodder to benefit 70 local farmers critically affected by the drought in the areas of Omatjete, Khorixas, Outjo and Otjimbingwe. Standard Bank’s Chief Executive Vetumbuavi Mungunda said Standard Bank in partnership with KaapAgri will be distributing the emergency fodder to the farmers in the affected areas. “Turning to our 4 year drought, it is very disheartening to hear and see the devastating impact of the drought on the farmers where most of them lost their hard earned animals – animals that could have made a difference in their farming operations. As an example, in the drought-stricken Omatjete settlement do not near Daures, it was reported that farmers lost 1318 cattle due to drought which is worth a combined income of N$10 million since November last year. Standard Bank has seen the plight of our local farmers and therefore saw
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the pressing need to assist them,” said Mungunda, who was the keynote speaker at the Windhoek Agricultural Show’s prize giving ceremony. He added that this has been a very challenging year for agriculture in the country and commended the local farmers, breeders and livestock owners for their perseverance and commitment [so] that they have been able to bring such a large number of animals to the Show this year. The agricultural sector continues to sustain an estimated 70% of the country’s population. It is one of the key earners of the foreign currency for the local economy through the exportation of amongst others beef and grapes. Furthermore the sector contributed 33% to the country’s total maize requirements in 2015, 12% of wheat requirement in 2014 and continues to fully meet both beef and mutton local demand. In this context, Mungunda noted that this significant contribution to the country’s import substitution and export earnings is not fully recognized and appreciated.
The Namibian Farmer | October - December 2016
Furthermore, the agriculture and forestry sectors have been projected to contract during 2016 due to the prevailing drought. Livestock is projected to contract by 6.9% in 2016, following a 14% contraction in the previous year. In conclusion, Mungunda congratulated the farmers who received awards in the various categories at the Windhoek Show saying they are instrumental in positioning the agricultural sector to be one of the major contributors to economic growth. “To the farmers, and all the players in the agricultural sector, don’t underestimate your enormous contribution to the Namibian economy and the basic livelihoods in our country. You earn foreign exchange, you feed the nation, you employ the most Namibians, you feed the workers that propel the other sectors of our economy, you keep our rural towns and communities alive. You need to be a lot more confident in demanding specific measures and the support needed to take this sector to a higher level of production and efficiency,” stated Mungunda.
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HOME NEWS
Export of weaners to commence
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amibian farmers can now start exporting weaners in large quantities to neighbouring South Africa (SA) again after some great progress was made in permit negotiations between the two countries. Chief veterinary officer in the Directorate of Veterinary Services (DVS) under the Ministry of Agriculture, Water and Forestry (MAWF), Milton Maseke said during a media briefing on the matter that four facilities have been approved by the Department of Agriculture, Forestry and Fisheries (DAFF) in SA for the export of weaners to that country. They are Morgan Beef, Maye West, Mushlendow and Braams.
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Local producers now just await their export permits from the Directorate of Animal Health, which falls under the DAFF.
testing and double tuberculosis (TB) testing,” MAWF acting permanent secretary Sophia Kasheeta said last month.
The DAFF recently commenced issuing less stringent import conditions for cattle, sheep and goats intended for direct slaughter and feedlot purposes in that country. No single calf was exported to SA since 1 July 2016 because the required screening tests before exporting livestock was too expensive.
The Namibia Agriculture Union (NAU) in its latest newsletter issued recently said that it is important that the dates of vaccinations against diseases such as anthrax, and the dates and results of tests for diseases such as TB, are available to facilitate the export process.
“More facilities are expected to be added in the near future. We expect that this development will bring relief to the farming community and exporters as the new permit reduces the need for compulsory pre-export Brucella
While weaner calf prices fluctuated around N$19,35 per kilogramme at the beginning of the year, the average calf price in July was about N$16,49. Prices are said to have decreased even further during August 2016.
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The Namibian Farmer | October - December 2016
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HOME NEWS
Kalimbeza Rice targets 350 tonnes
T “We are trying to get herbicides for the weeds, that will help to eradicate the sedge in the field, and for the nursery equipment we are in the processing of procuring some through the Food and Agriculture Organization’s (FAO) South to South Cooperation programme” 14
his cropping season the Kalimbeza national rice project is targeting to plant 150 hectares and expects a yield of more than 350 metric tonnes, according to Kalimbeza Rice farm manager, Patrick Kompeli.
A manager of a local restaurant confirmed that most of her clientele is now accustomed to the Kalimbeza rice which she said offers a different taste for the consumers, which has led her to order up to 10 tons of the locally produced rice.
During the first planting season in April 2015, the project planted 76ha including the fields for small scale farmers and from that land 120 metric tonnes were harvested.
Kompeli said the challenges that have been hampering the rice project are receiving attention and are being addressed.
Kompeli said that the possibility is high for Namibia to supply the whole nation countrywide, as research has already shown that rice can be grown successfully in the Caprivi and the Traditional Authority has already availed enough land for the project to expand. He said the rice which is now available for commercial sale, has seen locals and the Chinese in the country place orders. “We received orders of more than 1 ton from the Chinese who prefer to eat paddy rice instead of parboiled rice, and so far retailer, Spar and the Ministry of Defence has shown interest in buying our rice,” he added.
The Namibian Farmer | October - December 2016
“We are trying to get herbicides for the weeds, that will help to eradicate the sedge in the field, and for the nursery equipment we are in the processing of procuring some through the Food and Agriculture Organization’s (FAO) South to South Cooperation programme” he added. The first Namibian-grown, processed and packaged rice, under the Kalimbeza Rice label, entered commercial trading last year and was launched at a ceremony at the Polytechnic Hotel School by the Minister of Agriculture, Water and Forestry, Hon. John Mutorwa.
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HOME NEWS
Major step to staple food fortification fortification will be a licence requirement for all millers who supply milled grain to the general public. Angula said, “In my capacity as a civic citizen, I am concerned about the nutritional status especially of children under the age of five.” He said, “I became aware of this challenge when I was Prime Minister. In 2007, our National Planning Commission showed in a review where Namibia stood with regard to meeting the Millennium Development Goals at the time. One of those goals dealt with infant mortality rates. To our shock, we discovered that the infant mortality rate in Namibia was very high.” At the time, the report revealed that the infant mortality rate stood at 1 in 3 for children under the age of five years. The report prompted a countrywide survey to ascertain the lead causes of this high mortality rate in young children. Under-nutrition and malnutrition in the Namibian population indicated not just a lack of adequate food intake to support growth, but also an inadequate intake of vitamins and minerals especially where new-borns and infants were not breastfed. An aspect of infant and child mortality that Angula highlighted in his address is the symptom of anaemia in pregnant women and how malnutrition in babies starts during gestation.
Former Prime Minister of Namibia, founder and Chairman of the Namibia Alliance for Improved Nutrition (NAFIN), Nahas Angula,
F
ormer Prime Minister of Namibia, founder and Chairman of the Namibia Alliance for Improved Nutrition (NAFIN), Nahas Angula, addressed commercial millers, including small-scale commercial millers in Ongewdiva on the importance of fortifying processed grain with micro nutrients in order to foster a healthier population. The millers were gathered during a workshop on the food fortification process, organised by the Namibian Agronomic Board (NAB). In recent months, the NAB spearheaded an
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initiative to broaden the practice of fortifying milled mahangu and white maize meal as well as wheaten flour with micro nutrients. Once a predetermined ratio of micro nutrient cocktail is added to the milled product, the commodity that is sold to the public is significantly increased in nutritional value and has the potential of mitigating avoidable illnesses such as stunted growth and wasting. The initiative, which has support from various stakeholders, especially NAFIN, has progressed to the stage where the NAB has passed a resolution stipulating that by 1 April 2017, food
Malnutrition then, is a cycle that starts with expecting mothers who are anaemic and perpetuates with their infants who are born underweight and unable to thrive. In such instances, the mother is unable to breastfeed because she is unable to either produce milk or is unable to produce milk that has a high nutritional value, leaving the ever present threat of opportunistic diseases to take hold and premature mortality highly likely in the very young. Angula said not only is the physical development of children in jeopardy, but cognitive development is also badly affected, leading to poor academic performance throughout their schooling and learning problems throughout the rest of their lives. He said, fortifying staple foods with the addition of vitamins such as vitamin A, the full range of B vitamins and minerals such as Zinc and Iron mitigate problems such as poor eye health, heart disorders, weak muscles, a weak immune system, hair loss, dizziness and tiredness.
The Namibian Farmer | October - December 2016
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HOME NEWS
Meatco readies for exports
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ccording to the Meat Corporation of Namibia (Meatco), they are confident that new markets in the USA and China will bring producers maximum prices for exporting boneless raw beef products. The company is also in talks to introduce higher value vacuum-packed chilled beef and offal, sought-after products in the Chinese market that fetch premium prices. Negotiations on entering the USA market began with the application process six years ago and now the company has until 12 September 2016 to ensure that all systems are revisited at their Windhoek plant that is south of the cordon veterinary fence. Preparations at a national industry are also set to meet exports conditions. Both chilled and frozen boneless meat products excluding offals can be imported to the USA, the strategy in that, Meatco believes, is to target the fast food industry franchises like Mc Donald’s to maximise returns to producers. Approval from China to start beef exports has
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been granted. Following negotiations on the types of meat that can be exported, the market trends and the storage requirement for shipping to Asia. Meatco is currently in the favourable position of dictating how much beef will be exported to China. These new markets hold great potential and concerns are high to sort out operational procedures from the onset. Regulations such as China’s 60 days requirement for cattle to be on the farm before slaughter and vaccinating against anthrax. This includes the product labelling and certification by the Directorate of Veterinary Services. Under the final approved agreements, which will go ahead as planned, Meatco will be the first African country to export free range organic beef-in-bone exports to China. A lucrative market, with a beef consumption of more than 9 million tonnes annually. This the company said is a deliberate move in targeting other niche markets to streamline their product range and position products
The Namibian Farmer | October - December 2016
timely in new markets. Earlier statements from Meatco also suggests that Hong Kong is another market up for grab by Meatco’s Nature Reserve product. According to Meatco, this is another niche market that has opened up, allowing for more options to maximise returns for producers. The additional market gives Meatco the opportunity to streamline our cuts and make sure we position the right product, in the right market at the right time. The new logistical routes requires Meatco to ensure cost effectiveness and time management at all times. “Logistics and freight must be as simple as possible, because it will be of no use if a specific market cannot deliver higher prices/returns for our products.”Undamuje Hambira, Meatco’s spokeswoman, said. Adding that maintaining and improving quality, hygiene standards, systems and procedures throughout, in order to access world-class markets like this one has been in the making.
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REGIONAL NEWS
Scientists develop framework to promote agricultural policies
I
nternational scientists and researchers have developed a practical framework that will cut across all parameters of society to influence and promote better agricultural and nutrition policy choices and outcomes in Africa.
It has been dubbed as the ‘Kaleidoscope model for food security policy’, since the applied framework will act like a display (kaleidoscope) of refracting light on a new pattern but still focusing on a particular element of the policy process to reveal a different collection of key variables in the policy processes. The model focuses on five key elements of the policy cycle namely agenda setting, design, adoption, implementation and evaluation that will be supported by 16 key determinants of policy change. The model has so far been applied on case studies in Zambia, Malawi, South Africa, Tanza-
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nia and Ghana on fertiliser subsidies and micro-nutrient interventions such as food supplementation and fortification. Explaining the concept of the kaleidoscope model for policy change during the Feed the Future workshop on conceptualising the drivers of agriculture and nutrition policies, International Food Policy Research Institute (IFPRI) representative Suresh Babu said there is need for an understanding of how policies are made and implemented in different settings.
framework to study policy change processes. He said the model is based on the review of existing approaches by taking into account the policy change process in the development policy contexts in developing countries. The workshop has drawn participants from the donor community, academia, scientists, and media, and is hosted by the University of Pretoria in collaboration with USAID, Michigan State University and IFPRI.
“Who is involved, how do they work together, what is the process of policy-making? Is it by stroke of a pen? Does it involve long debates and dialogues? Is it transparent, strategic, consistent, and sustainable?” he asked. Mr Babu said drivers of change should understand the way policies are made and how they can help in improving the process by having a
The Namibian Farmer | October - December 2016
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REGIONAL NEWS
South Africa’s food price inflation increases
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he South African agricultural business chamber, Agbiz, recently reported that national food price inflation, excluding non-alcoholic beverages, had increased to 11,6% year-on-year (y/y) for August 2016, from 11,5% y/y for July 2016. This was despite headline inflation decreasing to 5,9% y/y for August 2016 from 6% y/y for July 2016. However, according to Agbiz head of Agribusiness Research, Wandile Sihlobo, food price inflation including non-alcoholic beverages remained unchanged at 11,3% y/y from July 2016 to August 2016. These figures were based on a food basket consisting of bread, cereals, meat, fish, milk, eggs, cheese, oils and fats, fruit, vegetables, sugar, sweets and desserts, and non-alcoholic beverages, amongst others. “The increase in bread and cereal inflation is still reflective of the effects of the 2015/2016 drought, which has led to lower grain supplies and, in turn, higher prices,” said Sihlobo.
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The rise in egg inflation was in line with increases in poultry feed prices, which was a result of higher grain prices. The increase in milk and cheese inflation coincided with seasonal milk prices, which normally reached higher levels during winter due to lower domestic milk supplies. “The increases in sugar, sweets and desserts inflation signifies the effects of the 2015/2016 drought on sugar cane production,” Sihlobo said. South African Grain Information Services (SAGIS) reported that over the 12 months from July 2015 to June 2016, the country produced more than two billion loaves of bread. Of these, 49,81% consisted of white bread, 48,49% consisted of brown bread, 1,57% was wholewheat bread, and 0,13% consisted of speciality breads. Sihlobo said that for the same period, brown bread production had increased by 5%, while white bread production had increased by 3%.
consumption included over 4,3 million tons white maize and 492 769t yellow maize for July 2015 to June 2016. “South Africa produced on average 252 265t [maize meal] per month. About 75% of this was super maize meal, 15% was special maize meal, and the balance was samp, sifted maize meal, grits and rice,” said Sihlobo. The country’s overall maize meal production fell by 8%, super maize meal production fell by 7% and special maize meal production fell by 14%. “These declines were partly due to substitution with other starches such as bread, potatoes and rice,” said Sihlobo. Agbiz expected dairy product inflation to remain elevated over the next few months, with inflation expected to begin slowing only when grazing recovered. Meat inflation was also expected to increase as livestock slaughterings decrease
According to SAGIS, maize products for human
The Namibian Farmer | October - December 2016
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REGIONAL NEWS
Tanzania to get two new
multi-million dollar sugar plants T
in a quest to avert shortages
wo new multi-million dollar sugar factory is set for commissioning soon in Tanzania, with the investor already having acquired ample land for the project.
The two sugar plants are planned for Mkundi in Morogoro eastern part of the country and Pemba on the island of Zanzibar. The 50 million US dollar (over 100bn/- shilling) investment will have an annual installed capacity of 280 metric tonnes, according to the Quality Group Limited (QGL) Project Technical Advisor, Mr Stavros Isaakidis. The facility whose construction is expected to take 24 months, effective December 2016, will sit on the 20,000 hectares.
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“We have received great cooperation from the ministry of agriculture, Sugar Board of Tanzania, Tanzania Investment Centre and all other stakeholders,” he said, adding: “The investment is part of efforts to heed President John Magufuli’s call for industrial led economy across the country.” The advisor said the project will be implemented in phases, with the first phase covering the installed capacity of 100,000 metric tonnes, and the second phase’s 180 metric tonnes. “QGL has collaborated with world-renowned international experts from the sugar industry, who have developed almost 300 of such sugar
cane mills globally,” Mr Isaakidis told reporters in Dar es Salaam recently. Tanzania’s demand for sugar has been increasing dramatically, with the government directing the ministry of agriculture and its trade, industries and investment counterpart to conduct a thorough assessment of the actual sugar demand. Initially, the demand for the sweetener stood at 450,000 tonnes, with domestic producers just producing a combined total of 300,000 metric tonnes, leaving a deficit of 150,000 metric tonnes.
The Namibian Farmer | October - December 2016
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REGIONAL NEWS
Zambia to maintain maize export ban in 2016
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Zambia is currently devising food security hedge that will absorb local demand before it can service demand from neighboring countries that are experiencing severe drought.
outhern Africa’s bread basket, Zambia will maintain a ban on exports in the remainder of 2016, as it strategizes to build reserves in a corn price rising environment where private buyers are offering 43% premium on the pricing. Zambia is currently devising food security hedge that will absorb local demand before it can service demand from neighboring countries that are experiencing severe drought. Tanzania and Zambia are the two countries that recorded corn surpluses in 2016. Zimbabwe, Malawi, Botswana and Namibia experienced severe drought due to inadequate rain as a result of El Niño weather.
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The Ministry of Agriculture in a statement by its permanent secretary Julius Shawa said, the ban will hold until all current and forecasted local demand is satisfied. Exports will not be at the expense of the locals he said. The government had by last month bought slightly more than a quarter of its 1-million metric ton strategic stock target for white maize. A market for maize has been created in famine struck nations such as Malawi and the Democratic Republic of Congo which illegal sellers would leverage to profit from at the expense of Zambians, Fewsnet said in their report. “We’ve tried to as much as possible contain the smug-
The Namibian Farmer | October - December 2016
gling,” Shawa said. “It is being brought to manageable levels but of course the borders are so long you cannot control each and every point.” Zambia increased corn production this year to yield a 635,000 ton surplus despite a regional drought that’s the worst in 35 years, the Agriculture Ministry said. The country has enough corn to last into 2017 even as it sees losses to smuggling and the government’s Food Reserve Agency missed its stocks target, Shawa said. “We are food-secure as a country,” he said. “Between the private sector and government we have sufficient stocks of maize to take us up to next year.”
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REGIONAL NEWS
Zimbabwean Govt to Import 1,7 Million Tonnes of Maize
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he Government of Zimbabwe recently announced that the country had harvested 511 000 tonnes of maize for the 2015/2016 production year, against a national requirement of 2,2 million tonnes. Preliminary results from the Zimbabwe Vulnerability Assessment Committee (ZimVAC) had indicated that the country was likely to produce 445 600 tonnes of maize compared to last year's 742 000 tonnes, reflecting a 40 percent decline from the previous season. Government statistics therefore indicate that the country will require to import maize amounting to 1,7 million tonnes for both human and animal consumption and deliveries to the Grain Marketing Board (GMB) indicate that farmers had so far delivered 175 000 tonnes. Indications are that the GMB is holding 273 000 tonnes of maize in stock, inclusive of imports, which at an ex-GMB off-take rate of 35 000 tonnes per month, represents seven months of GMB sales. Zimbabwe, like other countries in southern Africa facing the effects of a severe drought early this year, declared a state of disaster to allow for international aid organisations and government to raise cash for grain imports to meet the
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country's annual grain requirement. Announcing the Mid-Year Fiscal Policy Review last week, Finance and Economic Development Minister, Patrick Chinamasa, said the drought situation had undermined agricultural performance across provinces. "With regards to maize production this year, indications are that output will be around 511 816 tonnes, against the initial projection of 450 000 tonnes. The higher than anticipated output is attributable to good rains received in the second half of the season that helped some of the late planted and re-planted maize crop," Chinamasa said. The country received below normal rains during the 2015/16 rainfall season resulting in poor water availability for human, livestock and other livelihood options from October last year, especially in the southern parts of the country. "This adversely affected most crops, with lower yields projected for 2016 compared to last year. Decline in agricultural output of 4,2 percent comes even after taking into account the rainfall received from January, which allowed some maize re-plantings in some farming areas.
511 816 tonnes falls short of the normal national grain requirement of 2,2 million tonnes," Chinamasa added. The grain harvest forecast, including the small grains harvest, sorghum and millet, indicates that the grain harvest for 2016 will be at 575 582 tonnes. Government interventions to provide for the national maize grain deficit of 1,7 million tonnes are being complemented by the private sector and development partners' imports. By end of July government had imported 188 831 tonnes of maize and the private sector had imported 278 000 tonnes in the form of both maize and mealie meal. As the country battles to overcome widespread drought that has affected four million Zimbabweans, government will this farming season introduce command agriculture, a special programme in which government identifies farms that would be required to produce maize for the next three years. It aims to reduce grain imports and improve food security
"This year's estimated maize grain harvest of
The Namibian Farmer | October - December 2016
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INSIDE NAMIBIA
Inside Namibia’s studbreeding industry The Namibian stud livestock breeding industry currently consists of 79 000 head of registered livestock. Annelie Coleman spoke to Jacque Els, CEO of the Namibian Stud Breeders’ Association in Windhoek, about the distinguishing features of the industry in his country. What sets the Namibian stud breeding industry apart? Livestock production here is practised under tough, semi-arid to arid conditions. The rainfall is low and highly variable, from 75mm in the south-west to an average of about 550mm in the north-east. Livestock is the mainstay of agriculture in the country. Commercial crops are grown in a small area – on about 2 000ha at the Hardap irrigation scheme close to Mariental in the maize triangle of Otavi, Tsumeb and Grootfontein.
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Livestock stud breeding isn’t a hobby in Namibia. To stud farmers, it’s their bread and butter, and an integral part of their livestock production. Their commercial herds are linked to their studs and it’s all managed as an integrated system. Nowhere in Namibia is the livestock stud a secondary industry that’s run as a sideline to crops or any other form of agricultural production. More than 95% of stud breeders are bona fide farmers. But it’s true that due to the existing climatic and economic conditions, stud breeders and commercial producers are forced to diversify. How many stud breeders, animals and species are represented by the Namibian Stud Breeders’ Association? Even before independence, stud breeders expressed the wish to be in control of their own
The Namibian Farmer | October - December 2016
affairs. At that stage, all livestock registration and performance recording were still done through SA Stud Book. A group of stud breeders met on 25 February 1986, drafted proposals and started organising themselves. In 2002, an investigation was carried out to find an alternative registration and performance-recording system. The Australian Breedplan and Intergis 2000 systems were evaluated and on 9 August of that year the AGM decided to implement the Breedplan and International Livestock Registration systems. It was important to the NSBA that the three components – registration, performance recording and evaluation – were contained within one system. Since its inception, the NSBA has grown from 202 breeders from 11 breeders’ societies owning 25 016 animals to where it currently serves
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registration of animals is done in South Africa. The Boer goat is the largest goat breed, with more than 140 registered breeders and close to 20 000 registered animals. The Afrikaner cattle stud and Boer goat stud at the Omatjenne Research Station are probably amongst the oldest herds in the country, dating back to the late 1940s. The newest breeds are the Veldmaster sheep and the Droughtmaster beef cattle breed. What are the greatest challenges facing stud breeders? The biggest concern is the veterinary status of neighbouring countries, especially South Africa. Namibia currently has the highest disease-free status on the continent. Its breeders can export animals to any country within Africa on condition that the animals comply with the veterinary import regulations of the country of import.
as the registration authority for 35 societies – 23 cattle, two goats, four sheep and six horse breeds. That’s a total of 700 breeders who own more than 79 000 head of registered livestock. The Namibian Brahman Breeders’ Society was the first to sign up as a member. What is the biggest breed society and why are specific breeds so popular in Namibia? The Brahman breed society has the most members, with a membership of about 140 breeders owning 21 000 head of registered cattle. Thirty-five of these breeders are emerging commercial or communal farmers. The Brahman has the largest influence within the commercial beef sector. It’s estimated that about 70% of the commercial cattle herd are Brahman crosses or infused with Brahman. The Brahman is popular, especially as a crossbreed, because of the excellent mothering ability of the crossbred dam, while bulls are in demand because of the adaptability of the breed and its good growth characteristics. Brahman crossbred progeny are favoured in feedlots. The Bonsmara is also popular within the commercial sector, both as purebred animals and breeding bulls. Their medium-frame size makes them useful for production in semi-arid environments. The Dorper is still the most popular sheep breed. As purebred animals and crossbreeds, they contribute about 80% to the sheep population. The
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When South Africa was not accessible to Namibian stud breeders due to foot-and-mouth disease (FMD) – from February 2011 to May 2014 – breeders of the smaller breeds in Namibia struggled to obtain new material. This forced them to import expensive semen from abroad. There’s close cooperation between the NSBA and other livestock registering federation authorities in South Africa. We all use the Breedplan system for registration, performance recording and certification. When information is requested, either from SA Stud Book or on animals imported into Namibia or exported to South Africa, this is exchanged. Who are Namibian stud breeders’ main clients? These are commercial beef and emerging commercial sectors as well as farmers from the communal sector, including the Northern Communal Areas. Namibian beef producers demand bulls that will add to the production of weaners with good growth potential for the feedlot industry and the production of slaughter oxen with a 230kg to 260kg carcass, produced from the veld at the age of 30 months to 36 months (AB-grade or B-grade). They also need bulls that will provide well-adapted crossbred females that can be bred from 21 months to 24 months, calve early under extensive production conditions and produce a good-quality weaner calf every year. During the past decade, stud breeders developed markets in Angola, Botswana and Zambia. Every year, a number of breeding bulls (and breeding females from time to time), are exported. Angola is currently the biggest market. Its cattle population decreased drastically during the war, and producers are looking for well-adapted animals to restock and improve herds. It’s easier and cheaper for them to buy quality animals in Namibia. The Bos indicus breeds are particularly sought-after. Widespread incidences of brucellosis and trichomoniasis are increasingly reported in Southern Africa. What is their possible im-
pact and how does the stud industry manage them? Due to its meat exports to the European Union, Namibia has to comply with stringent vet requirements. Inoculation against brucellosis, anthrax and black quarter is compulsory and proof of all vaccinations and inoculations has to be produced upon inspection. The Livestock Producers’ Organisation has an ongoing sensitising programme to warn farmers against problems associated with these diseases. At auctions of stud cattle, sellers must hand in health certificates to prove that animals are free of brucellosis, trichomoniasis and vibriosis, and in the case of bulls, a fertility certificate not older than 30 days. The outbreak of FMD earlier this year in the Northern Communal Areas of Namibia occurred close to the border with Angola when infected cattle entered from that country. It was the areas’ first recorded case of FMD in 50 years. Although it did cause a stir within the commercial farming sector, it never posed a threat. This was due to immediate action taken by the Department of Veterinary Services (DVS) within the Ministry of Agriculture, Water and Forestry as well as efforts by commercial producers to contain the disease. The movement of all livestock was banned within these areas. The transportation of animals for ceremonial slaughter was done under the supervision of DVS staff members. Largescale testing was carried out to find any more infected cattle and a vaccination campaign launched, with government providing the funding. The commercial sector inspected the veterinary control fence (red line) and repaired the damaged section. All of this proves how effectively the farming sector and government can work together. What is the best-case scenario for Namibia’s stud-breeding industry in 10 years? This would be if Namibia, South Africa, Botswana Zimbabwe and Zambia – the main livestock-producing countries – could have FMD-free status. It would simplify the flow of genetic material within the SADC region. There is a market for genetics from Southern Africa, particularly in South American countries, but the prevalence of FMD acts as a barrier to exports. Hopefully, 10 years from now Namibia will also have an independent artificial insemination and embryo transfer industry. What is the worst-case scenario? Namibia losing its FMD status. The country is a nett exporter of beef, mutton and goat. Should the availability of brucellosis vaccine continue or worsen, Namibia’s export market for beef will be jeopardised. If the prevalence of brucellosis, trichomoniasis and vibriosis increases, herd fertility and productivity will be negatively affected. Email Jacque Els at jacque@iway.na.
The Namibian Farmer | October - December 2016
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INSIDE NAMIBIA
Keeping track of livestock production profitability
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he marketing of Namibian livestock has increased significantly since the beginning of 2015 as a consequence of drought. A total of 83 125 head of cattle were exported live to South Africa in July, August and September. The Namibian Agricultural Union’s Production-Cost Index is a valuable tool for determining and monitoring price trends in the country’s livestock production industries, according to Jaco Hanekom, the union’s assistant manager of commodities. The index has lately shown an alarming negative price trend in cattle production. The economic term ‘cost-price squeeze’ is often used in agriculture to describe the relationship between income and expenses, and more specifically, the rate of increase of both variables. It relates to a situation where average expense increases at a faster rate than the accompanying average income for a specific agricultural sector. However, it is difficult to quantify and keep track of the actual rate at which the average input price increases more than the accompanying average price of output over time. For this reason, the Namibia Agricultural Union (NAU) developed the Production-Cost Index, which keeps track of the income-expense relationship and how it changes over time. Such information is crucial, and highlights the importance of quantifying the effect of the cost-price squeeze phenomenon. The index is based on a basket of products for each farming expense category. A weighting is allocated to each category based on its size relative to the total farming expenses of the average livestock farming enterprise in Namibia. The same is done for income, which is primarily based on the relative price of sheep and cattle over time. The relative cattle price consists of an appropriately weighted (in terms of marketing volumes) combination of the average weaner and average carcass price. After appropriately weighing the expenses and income, these are indexed from a specific base year. This allows for an effective comparison of changes from the base year onwards. Therefore, by using this Production-Cost Index, the cost-price squeeze phenomenon can be quantified and monitored over time. The international picture Since the global economic crisis of 2008/2009, an increasing cost-price squeeze has been a worldwide phenomenon in most agricultural
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The Namibian Farmer | October - December 2016
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tential to significantly increase production and efficiency during a time when profit margins are under pressure. Adopting smarter and more cost-efficient technologies is crucial; the increasingly popular solar energy technology is an excellent example. Farmers also need to increase the carrying capacity of their farms, especially in the north-central parts of Namibia, where bush encroachment has become a serious problem. Bush thinning is already administered by individual farmers, with proven benefits in terms of production and economies of scale advantages. Despite the challenges that the livestock industry faces, there are still many opportunities to overcome these and grow the industry. – Annelie Coleman
sectors. The United Nation’s Food and Agriculture Organisation has forecast that the real prices of agricultural commodities may decline for another decade. Namibia is no exception. The cost-price squeeze is evident in both its cattle and sheep industries, resulting in a decline in the real prices of beef/ cattle and mutton/sheep. Concerns over cattle The Production-Cost Index for the third quarter of 2015 continued to indicate an increasing cost-price squeeze in the cattle industry, with the sheep industry reflecting a more positive scenario due to more robust sheep price increases over the 10 years of monitoring. Measured from the base year of 2006 (first quarter 2006 = 100), cattle income increased to end at 157,64 basis points (bps) in the third quarter of 2015, while total expenses increased to 242,68 bps over the same period (Figure 1). On the other hand, sheep income ended at 258,59 bps (Figure 2), keeping up with the rise in expenses over the 10-year period. The large degree of diverging input and output prices in the cattle industry over the past 10 years, as reflected in Figure 1, led to an average annual cost-price squeeze of 7,54% from the first quarter of 2006 to the third quarter of 2015. The sheep industry reflected a much more manageable 2,33% over the same period. The worrying price trend in Namibia’s cattle sector, which has been especially visible since the beginning of 2012 (Figure 1), is also supported by comparing the average EU and UK R3 steer prices (converted to Namibian dollars to account for the exchange rate effect) to the Namibian A2 carcass price (Figure 4). The sharp increase in the EU and UK prices (NAD) since the beginning of 2012, as seen in Figure 4, was primarily due to the weakening of the Namibian dollar against both the euro and pound. Despite Namibia exporting a significant portion of its beef cuts to the EU and UK markets, the exchange rate advantage evident since 2012 did not have the desired
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effect on the Namibian carcass price. This was due to significant challenges in terms of drought since 2013, stagnant slaughter numbers at local export abattoirs, a tough global economic climate, and several other factors which depress local producer prices. The effects of the 2012/2013 drought is evident in both Figures 1 and 2. During this period, both cattle and sheep prices dropped significantly, with a slight acceleration in expenses during the same period. The 2014/2015 season also turned out to be a challenging time, with below-average rainfall figures for much of Namibia. As a consequence of the drought, the marketing of livestock has increased significantly since the beginning of 2015. Record figures were achieved in the third quarter of 2015, with 83 125 head of cattle exported live to South Africa in July, August and September. Increasing inflation rates The latest on-farm inflation rate, as reflected in Figure 3, ended on 4,9% for the third quarter of 2015, up from the 2,72% recorded in the second quarter of 2015, but still significantly down from the 12,18% registered in the first quarter of 2014. The lower average on-farm inflation rate for 2015 when compared with 2014 was driven by the sharp drop in oil prices experienced since the second half of 2014, with iron ore and steel prices also plummeting over the past 12 months. The fall provides welcome relief for Namibian farmers, especially during a period of drought and tough global economic conditions. As many farming inputs are imported from South Africa, fuel (for transport) makes up a significant portion of the price of these products. Space to improve The Production-Cost Index accentuates the fact that Namibian livestock producers need to constantly increase production and improve efficiency to keep current profit margins intact. Precision farming, the theme of this year’s Livestock Producers’ Organisations’ Congress, should be taken more seriously by farmers. It has the po-
The Namibian Farmer | October - December 2016
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The Namibian Farmer | October - December 2016
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Autoflush flushes the machine every time the pump starts.
The AGRICO 3-legged center is exceptionally strong.
AGRICO one stop service: Survey, design, manfacture, delivery, installation and after sales service.