Namibia is recovering from drought and most producers are finding it difficult to restock their herd. To assist producers in delivering slaughter animals and in an attempt to secure consistent throughput for the Windhoek Abattoir, Meatco now has re-introduced the Meatco Fixed Price Slaughter Contract (FPSC).

What is the future’s contract?

A future’s contract is a legal agreement generally made on the trading floor of a future’s exchange, to buy or sell a particular commodity at a predetermined price at a specific time in the future. In this instance, the commodity is slaughter cattle from producers. The producer signs a legal, binding contract to provide a certain amount of slaughter animals to Meatco at a fixed price and at a set point in time. Certain terms and conditions are attached to the contract that will be unique to Meatco.

How it works:

For the fixed price slaughter contract, Meatco will release slaughter prices three to four months prior to the period in which producers can enter into a fixed contract with the company. This will be published every Friday along with the regular slaughter prices. Generally, one week will represent each contract period and the price communicated will only be applicable for that week.

Each week, a pre-allocated available quota of slaughter animals will be announced. The contract opens from Monday 08:00 until Thursday at 16:30 of the same week. Producers must send their signed contract with initialled pages along with the signed offer for each week to the email address FixedContract@meatco.com.na which is solely used for the trading of these contracts. If a producer does not have access to e-mail, he/she is welcome to visit their nearest Meatco office to sign a contract there and send an e-mail from there. 

The electronic time stamp on each e-mail received from Monday at 08:00 to Thursday at 16:30 on a weekly basis will be used to determine the sequence of application. Meatco reiterates to producers and their witnesses that they are encouraged to initial all pages.

Producers have the option to apply for part of the quota per week. For example, if the prices for week 43 are more attractive than week 41, the producer may apply for that week. However, once the contract is entered into, it is fixed and binding. The producer must sign a contract with the attached Schedules-A&B for each week he/she wishes to take part in. Producers cannot roll-over signed contracts to the next contract period if an allocation is not obtained for the applied period.

As from, Friday 24 July 2020, the contract and Schedules-A&B will be communicated weekly, every Friday, along with the Meatco producer price. Fat equalisation, measles and any other deductions that negatively impact the price will be dealt with according to the contract Schedule-A.

Producers must comply with FANMEAT regulations when entering the contract. Cattle must also be compliant with European Union export requirements and it must be fit for human consumption as per the regulations of DVS.

WEEKLY FIXED-PRICE SLAUGHTER CONTRACT PRICES

Please contact:  Abrie van Wyk at 061 321 6400 or FixedContract@meatco.com.na  for any queries.