AGRICULTURAL NEWS - The beef industry is being strangled by South Africa's deepening drought, already characterised by rising maize prices, starvation and severe water shortages.
This trend is likely to continue into 2017 and has placed the spotlight on the precarious state of South Africa's food security.
This is according to PG Lombard, sales manager at Elanco, a global company that develops and markets products to improve animal health and food animal production in more than 75 countries.
"There is a dramatic decline in the quality and number of cattle coming into the feedlots. In the continued face of the drought, beef supply could drop by 30%-40% this year alone.
"There is a dramatic decline in the quality and number of cattle coming into the feedlots. In the continued face of the drought, beef supply could drop by 30%-40% this year alone.
When drought relief comes in the form of normal rainfall patterns, it could take another 18-24 months for farmers to recover and replenish their breeding herds, creating a deficit on the supply side. The next two years will be marked by a shortage of beef for local demand and export, the cost of beef will escalate dramatically and the economic viability of many cattle farmers and feedlots remains uncertain," says PG.
Grazing and maize imports
The lack of quality grazing land means beef producers have to supplement animal diets with expensive feeds, which are already in short supply. In many areas water has to be transported in at huge cost.
The price of yellow maize used for animal feed has rocketed by 93% from R1946/ton in Jan 2015, to R3,757/ton at the beginning of January 2016. South Africa may have to import an additional five million tons of maize due to widespread crop failures. High maize prices are expected to persist until 2017 according to Grain SA.
The lack of quality grazing land means beef producers have to supplement animal diets with expensive feeds, which are already in short supply. In many areas water has to be transported in at huge cost.
The price of yellow maize used for animal feed has rocketed by 93% from R1946/ton in Jan 2015, to R3,757/ton at the beginning of January 2016. South Africa may have to import an additional five million tons of maize due to widespread crop failures. High maize prices are expected to persist until 2017 according to Grain SA.
To put a reality check on just how serious the drought conditions are, the highest amount of maize ever imported by SA in a year was only 1,2 million tons in 2007/8.
Farmers forced to cut back on nucleus herds
"In the face of soaring costs and a shortage of food and water, farmers are forced to cut back on nucleus herds and breeding cattle to margins as low as 10% in a bid to stay afloat. Typically, farmers will keep 30-40% of their herds for breeding for the next season, but under the current conditions, this is simply not possible.
"In the face of soaring costs and a shortage of food and water, farmers are forced to cut back on nucleus herds and breeding cattle to margins as low as 10% in a bid to stay afloat. Typically, farmers will keep 30-40% of their herds for breeding for the next season, but under the current conditions, this is simply not possible.
Beyond the economics of sustaining these animals, there are also real concerns regarding animal welfare. In the face of starvation and no water, many farmers face the unenviable decision of having to cull," explains PG.
According to market statistics, South Africa slaughters around 3.5 million cattle each year to meet the local and export demand for beef. However, cattle placements into feedlots have dropped dramatically over the last few months and continue to do so.
According to market statistics, South Africa slaughters around 3.5 million cattle each year to meet the local and export demand for beef. However, cattle placements into feedlots have dropped dramatically over the last few months and continue to do so.
"We'll be lucky if we can produce two million animals for beef production this year. The knock-on effects of the drought economically and socially are significant for SA," says PG.
