Meatco pays producers N$400m

By Hilary Mare

MEATCO paid N$400 million to producers, which include a premium of N$61.8 million above the South African parity price, the corporation’s 2020/21 annual report reveals.

In essence, the average producer price paid during the 2020/21 financial year amounted to N$44.74 per kilogramme compared to N$44.25 per kilogramme during the previous year.

In the report, chief executive officer, Mwilima Mushokabanji also notes that due to various cost-cutting initiatives across operations, Meatco made a saving of approximately N$25 million during the review period.

Despite this however, Confidente recently reported that Meatco generated only N$873 million in revenue (2020: N$1.7 billion) and incurred a loss before tax of N$118.64 million (2020: N$113.66 million loss).

“During the reporting year, and in stark contrast to the previous year, a better rainy season resulted in very few cattle available for slaughter, as producers were restocking their farms. Therefore, a huge throughput challenge was then presented, with the slaughtering of only 36 074 cattle, in contrast to a total capacity of 120 000 cattle. This was far below our expectations, but we were aware that this situation could unfold,” Mushokabanji notes in the report adding that it was therefore essential for Meatco as an institution playing a critical role in the agriculture sector, to make sure that it reconfigures its strategic interventions by developing a leaner, agile and dynamic organisation that remains competitive, profitable and sustainable.

“We needed to make sure that we secure the viability of Meatco. We reviewed our vision, stating that we want to create an agile, dynamically-capable commercial public enterprise that creates wealth for all Namibians. We achieved this, firstly, by focusing on throughput. It was not enough to focus only on quality into the abattoir; both quantity and quality were important,” he said.

Mushokabanji further states that Meatco needed to play a role in creating a conducive environment that would boost the primary production, both in the Northern Communal Area and commercial areas south of the Veterinary Cordon Fence (SVCF).

“We needed to make sure that we improve our efficiencies and effectiveness in agro-processing, in the management of the abattoir as a whole. We had to make sure that we cut out the inefficiencies in our system, especially when it comes to public procurement of outsourced services.

“In striving to do that, we made sure that we internalised most of the services as a cost-cutting measure. We also had to make sure we maximise returns from our markets. Because of the outbreak of Covid-19, it was important for Meatco to make sure that we sustain our presence in some of the emerging economies, such as China with a growing middle class. It was critical that we keep on expanding our food brand in this particular market,” explained Mushokabanji.

He also noted that there are endless opportunities in the Northern Communal Area (NCA), because throughput challenges exist not in the whole of Namibia, but only South of the Veterinary Cordon Fence.

“North of the Veterinary Cordon Fence, the challenge that remains is although we have a higher throughput and good quality animals, no market exists for these animals. Dealing with this challenge, Meatco is prepared to create markets for our products in the Northern Communal Area, to improve our competitiveness and profitability.

“This will be done through exploring markets in West Africa and elsewhere. We are currently exploring an expansion into the Ghanaian market. This will bring the Northern Communal Area into the mainstream economy, by getting more profitable markets for NCA farmers,” said Mushokabanji.