The Namibia Agricultural Union (NAU) and the Livestock Producers Organisation (LPO) are making efforts to secure revolving funds from the government to guarantee payment to producers as auction houses report good demand for cattle weighing less than 300kg.
These are part of the plans the NAU has been preparing to mitigate the impact of a looming drought after abandoning the Dare to Care campaign subsidy for farmers in 2024.
Despite the 2019 Dare to Care campaign being described as a great success that raised over N$11 million with the help of corporate partners to provide feed subsidies to producers, such a campaign is a “drop in the ocean” in terms of the national drought losses experienced by producers, said the NAU.
According to the latest issue of the NAU newsletter, while the union does not anticipate bottlenecks in this market, the price of weaner calves may decline during the March to June weaning period in South Africa, but this is a normal seasonal market phenomenon.
“The significant challenge is managing the impact on auction prices, especially for lean cows.
A way of mitigating this is to keep a healthy demand for lean cows at auctions,” said the NAU, adding that lean cows need additional feeding before they can be marketed to an abattoir.
The union, however, conceded that delayed payments by abattoirs may cause a negative reaction throughout the marketing chain, thus the move to seek funds from the government.
Meanwhile, the NAU said the local market for sheep was limited, therefore, auction prices were under significant pressure and the South African live export market, therefore, remains crucial.
“Since sheep can be efficiently rounded off in feedlots, producers can adapt to market requirements although the biggest challenge at present is the feed price/mutton price ratio which suppresses the profitability to round off sheep in feedlots,” said the NAU.
The oversupply of lucerne in South Africa is currently not reflected in the market price of lucerne-containing sheep rounding-off products, although efforts are being made to import lucerne/hay more easily without jeopardising Namibia’s foot-and-mouth disease-free status.
The NAU encouraged members to complete the questionnaire with outstanding VAT data to be shared with the Namibia Revenue Agency and the finance ministry, to make them aware of the magnitude of the farmers’ cashflow problem.
The union said discussions with AgriBank are curr
“It is crucial that producers conduct a cash flow forecast early and engage their local bank on this matter,” said the NAU.
– email: matthew@namibian.com.na
