December 11, 2023

 

South African beef industry grapples with a challenging year

 
 

 

Roelie van Reenen, the supply chain executive at South African-based Beefmaster Group, said the South African beef industry faced a tumultuous year marked by a disease outbreaks, IOL reported.

 

He said that while grain farmers enjoyed financial gains, profits for the beef, chicken, and pork industries were impacted by foot and mouth disease (FMD), avian flu, and African swine fever, among other factors.

 

Paul Makube, a senior agricultural economist at FNB Commercial, noted negative price growth for beef and pork, with poultry mostly flat. Overall livestock slaughter fell by 8% relative to the previous quarter.

 

Makube said the livestock sub-sector also grappled with disease outbreaks such as avian influenza in the poultry industry, making a significant dent in overall agriculture growth.

 

Six of the nine provinces in South Africa were affected by FMD last year, leading to a temporary halt in exports to key markets, particularly China.

 

Although South African beef exports dropped by 12% to 28,422 tonnes last year, slightly lower than the ten-year average, the impact of FMD hampered local producers' export opportunities.

 

Van Reenan said FMD has now largely been contained, which should signal a warning to the industry for 2024, that there is a need to better manage disease outbreaks to unlock more gains for the industry.

 

The resumption of beef exports to Saudi Arabia offers some compensation for the loss of sales in other parts of the world due to the Middle East conflict.

 

Looking ahead to 2024, Van Reenen anticipates increased demand for beef in China, although challenges in pricing structures may arise. South Africa has shifted from a net importer to a net exporter of beef over the past 20 years.

 

Despite challenges, Van Reenen remains cautiously optimistic for 2024, highlighting potential relief from high inflation and a positive impact if general elections go well.

 

-      IOL

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