Drought conditions in Namibia led to a rapid expansion of live cattle exports from January to September 2013. Some 222,206 cattle were exported live on the hoof to South Africa and Angola, while Meatco, the main Namibian meat processing company, slaughtered 98,392 cattle and other abattoirs slaughtered 34,286 cattle. Fully 62.6% of all cattle marketed were sold on the hoof. With an increase in the number of cattle coming to market before pasture conditions deteriorated further, Namibian and South African markets were flooded with cattle and meat, leading to price declines on both markets.
Beyond South Africa, a lively trade in meat and cattle is emerging with Angola, Zambia and the DRC.
According to a Meatco representative, the impact of live cattle exports “will affect the whole cattle and slaughter industry for the next three years”, as “Namibian farmers have exported too many cattle and kept too few cattle for restocking and herd building.” According to national press sources, “it is predicted that there will be limited calves, few weaners, limited stores and few slaughter oxen up to 2016.” The restocking situation will be compounded by South Africa’s current Foot and Mouth Disease status, meaning that Namibian borders are closed to live cattle imports from South Africa. Scope exists for restocking from some parts of Botswana that enjoy equivalent health status to that of Namibia south of the veterinary control fence. However, beyond these zones, opportunities for restocking from African herds without losing Namibia’s current disease status are non-existent.
An EU review of the beef sector shows that since 2010, Namibian beef exports to the EU have fallen to the EU by 35.9%, while Botswana beef exports to the EU have fallen by 97%. This has taken the ACP share of total EU beef imports from 7.74% in 2010 to 3% in 2012. In contrast, exports between 2009 and 2012 from countries utilising the new high-quality beef quota increased by 116% in the case of the USA and by 24.8% in the case of Australia. Latin American exporters from the Mercosur group accounted for almost 75% of EU beef imports.
The decline in Namibia of local slaughtering of cattle (the throughput of cattle at Meatco is now less than two-thirds of the level at the time of the launch of the EPA process) and the prospect of reduced levels of slaughtering and meat processing through to 2016 would appear to increase pressure on the Namibian livestock industry to rebuild stocks to service the EU market with high-quality products. Options are being explored linked to region-specific zoning, and intense discussions are likely to be required with the EU on this issue.
The consequences of a loss of access for Namibian beef exports to the EU market has traditionally been a matter of concern, since the EU still provides some of the best prices for premium cuts of beef (see Agritrade articles ‘ Meatco’s strategy for moving up the value chain’, 2 December 2012, and ‘ Quality differentiation pays off for Namibian beef farmers’, 23 April 2012). While new regional markets have been developed to remove animals from deteriorating pastures, this can be seen as largely an emergency measure, rather than as a fundamental reorientation of the beef sector export trade. (For the northern communal areas, on the other hand, it is hoped that the new patterns of trade could become more firmly established.)
However, competition on the EU market is increasing and the share of ACP exporters of EU beef imports has fallen considerably. Were Namibian beef exports to be available on the EU market in only significantly reduced quantities in the coming years, it could prove difficult in subsequent years to regain market share, given the growing level of competition from third-country suppliers on the EU market.