Meatco producers may challenge Cabinet

By: JAN POOLMAN

THE new ownership of Meatco will be made public this week, after Cabinet decided about three weeks ago that Government will take up 30% of the trading company, while the cooperative will be fully owned by the producers.

This is in conflict with the proposal of the Meatco Working Group, which consists of the meat producers, as well as the Namibia Agricultural Union (NAU), the Namibia Emerging Commercial Farmers’ Union (NECFU) and the Namibia National Farmers’ Union (NNFU).
The Working Group proposed a cooperative, wholly owned by participating Namibian livestock producers, as the holding entity and a public company as operating and trading company without any Government shares.
“I have received the Cabinet action letter and will during the course of this week informed the public about the future of Meatco,” Agriculture Minister John Mutorwa told The Namibian.
However, Meatco’s annual general meeting decided on Friday that a special AGM would be called if the Minister announced a different model than that of the Working Group, which was unanimously supported at Friday’s meeting.
“At this stage we cannot comment on the new structure since we have not been officially informed what it entails, but the producers want a special AGM if the structure of Government differs from that of the Working Group. Then only the producers will decide on the way forward,” said the chairperson of the Meatco board of directors, Clara Bohitile.
Some of the communal and emerging producers who attended the AGM told The Namibian that it seems Government does not understand the proposal of the Working Group and the protection that is built in for communal and emerging farmers.
“It will be good if the Working Group can make a presentation to Government so that their fears about the communal and emerging farmers in a new Meatco could be put to rest.”
The producers are also of the opinion that the Government should not compete with them to make money and if the state wants the 30% shares they have to pay for it.
Bohitile pointed out in Meatco’s 2011/2012 annual report Government imposed a 50-50 quota split of exports to the Norwegian market between Meatco and Witvlei Meat.
“This reduction is estimated to have cost Meatco producers approximately N$35,5 million during the period under review if compared to a proportional split of the quota based on cattle numbers processed by the different exporters in Namibia. The average producer price could therefore have been increased by roughly N$1.35/kg if Meatco could have retained a share of the Norwegian quotas, based on throughput.”
However despite this and other factors that affected the performance of Meatco during the 2011/2012 financial year, the company managed to turn its loss of N$89,7 million in the 2010-11 financial year into a profit of N$10,5 million in 2011-12.
The group made an after-tax profit of N$5,7 million in 2011-12, compared to an after-tax loss of N$62,6 million the previous year. Meatco’s revenue grew from N$1,3 billion to N$1,4 billion as a result of improved market realisations due to the positive effects of the corporation’s value addition strategies and branding, as well as marketing and sales strategies.
The AGM again reconfirmed that farmers must sell at least one unit of livestock to the Operating and Trading Company during a period immediately preceding two years from the date at which his/her membership is to be determined.

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