Meatco CEO, Mwilima Mushokabanji
Dear Valued Stakeholders,
Allow me the opportunity to extend my heartfelt welcome for the new season.
The year has kicked off on a rather refreshing note with the good rains we are receiving after almost nine years of recurrent droughts. This brings a brighter outlook as we anticipate prosperity for the agricultural sector amid the prevailing global COVID-19 Pandemic that has infiltrated our lives and poses boundless uncertainties daily. A clear testimony that we live in a world that is volatile, uncertain, complex and ambiguous and how we ought to remain agile and dynamic as a business.
Despite this, Meatco remains a critical stakeholder in the meat industry that has the mandate to serve, promote and coordinate the interests of all livestock producers in Namibia and strive for the stabilisation of the meat industry in the national interest.
2021-2025/6 Strategic Business Plan
Dear valued producers, we have finally concluded our Integrated Strategic Business Plan (ISBP) for the period 2021-2026, which is a blueprint for a futuristic Meatco that strives to be A World-Class Meat Brand Creating Sustainable Wealth for All Namibians. The ISBP, which was submitted to the Ministry of Public Enterprises on 21 December 2020 for review and approval, connects the dots between big picture strategic elements, Meatco’s Vision, Mission, core values, strategic objectives and key strategic initiatives such as increasing throughput, improve operational efficiency and maximising on market returns without compromising our high-quality standards and principles of corporate governance. The Plan has five strategic goals namely:
Strive Towards Corporate Profitability and Financial Viability;
Embrace and Promote Good Corporate Governance;
Build a High Performing Culture for Meatco;
Enhance Stakeholder Engagement and Build the Meatco Brand; and
Optimise Meatco’s Competitiveness Across the Value Chain.
Despite the afore-mentioned challenges and achievements, with your unwavering trust, resilience and commitment as Namibian farmers, we remain confident that we shall meet the set targets during the next five years.
Stakeholders Important to Meatco
2021, will prove to be another year in which we rigorously engage and sustain conversations with you, through our platforms such as the Meatco Foundation, our Corporate Social Responsibility (CSR) vehicle, Producer Forums, Farmers Liaison Meetings (FLMs) and pertinently, through our Agriculture Extension and Advisory Services Programme, which was launched and successfully held the first class late in October last year.
In the face of overwhelming adversity, Meatco had to demonstrate a heightened level of agility, adaptability and creativity in implementing cost-cutting measures as well as engaging with employees, producers, farmers unions, suppliers, financial institutions, Government and our key customers locally and abroad to keep the business afloat.
I am glad to inform you, that farmers from far as Gam will be able to market their cattle directly to Meatco and these cattle will be slaughtered directly at our abattoir. We achieved this following extensive engagement with the Ministry of Agriculture, Water and Land Reform (MAWLR) and the newly renovated kraals are now EU-complaint, as such farmers will be able to market their livestock with ease.
The Gam marketing kraal will officially be opened next month and direct procurement of cattle from the area is an important milestone for Meatco and the livestock industry.
Slaughter budget and producer price paid-out
From February to December 2020 Meatco slaughtered 35 314 cattle compared to 115 305 in the previous year. The average producer price paid for the same period amounted to N$44.74 compared to N$44.23 in the prior year. The average carcass weight increased by 13 kgs from 229 kgs in 2019 to 242 kgs in 2020. Meatco paid out a total amount of N$382 million to producers over the past 11 months. These statistics represents the difficult climate in which Meatco was operating in over the past year. supply and demand dynamics played a huge part in the price paid out as well as strategies implemented to obtain additional cattle. With the good rains received this month, cattle will be scarce as producers are continuing to build their herd and improve the quality of cattle. The Meatco Team is equally excited to take up the challenges of the new financial year with our innovative strategies approved by the Board of Directors.
Meatco Operations in the Northern Communal Area (NCA)
As part of Meatco’s mandate to serve all Namibian farmers throughout the country. Our Meatco NCA Subsidiary is geared to implement our strategies as well as the Cabinet Decisions and Directives meant to address the plight of our producers in northern Namibia, who have had no access to export markets since the outbreak of the foot-and-mouth disease in 2015, through the implementation of Commodity Based Trade and strategic partnerships with the operators of the NCA abattoirs as well as the establishment of feedlots and fodder production schemes to improve the quality of marketable animals. This is a clear demonstration that Government is committed to create a conducive policy and legal environment that supports MEATCO’s operations both in the areas south and north of the Veterinary Cordon Fences (SVCF & NVCF).
In this connection, Meatco shall operate the Rundu Abattoir and provide technical support in the operation of Oshakati and Katima Mulilo abattoirs. The renovation of the Rundu Abattoir is nearing completion and is expected to be handed over during the first quarter of this year. We shall also continue to operate our Mobile Slaughter Unit (MSU) and the Meatma Bonanza, as an outlet for distributing and selling our products in the NCA.
Outbreak of Foot-and-Mouth-Disease (FMD) in the NCA
Meatco is extremely concerned about the ongoing and perpetual outbreaks of foot-and-mouth disease (FMD) in the NCA, specifically in the Zambezi, Kavango East and Kavango West regions and recently in the Ohangwena, Oshikoto and Oshana Regions. Meatco stands with the Directorate Veterinary Services (DVS), alongside other industry role players in the treatment, containment and prevention of FMD that has the potential to negatively affect the area SVCF. A reactive approach is compromising and not sustainable, therefore, it is critical that a sustainable and permanent solution is found to ensure a capacitated pragmatic approach by all industry stakeholders to mitigate the impact of future FMD outbreaks on the livelihoods of the affected farmers and agribusinesses in the NCA that are already devastated by the ongoing COVID-19 Pandemic. Meatco shall continue to support efforts that are aimed at developing a sustainable and permanent solution to the FMD challenges in the NCA.
Competitiveness in the business
It goes without saying that the competitiveness, profitability, and sustainability of Meatco is highly dependent on optimum throughput, operational efficiency, and efforts to maximise market returns. Throughput at export abattoirs in Namibia is guaranteed by the size of the national herd, which requires an enabling policy and regulatory environment that is supported by responsive measures such as incentives and subsidies to increase primary production, thereby, unleashing the potential that the meat industry can contribute to job creation, foreign exchange earnings, economic growth and the industrial development agenda of Namibia.
Sales and Marketing Outlook
2021 is seeing the birth of Brexit finally, and we believe that it can alter opportunities for Meatco in Europe and United Kingdom (UK) markets.
With the onset of 2021, cattle prices in Europe remain firm while in the UK prices started higher than the previous five-years’ high points.
Norway will remain our key focus market with China expected to also bring its significant contribution as the only market beyond Africa that accept bone-in beef products. Meatco is proud to be the only abattoir in Africa that exports beef to the USA despite the socio-economic developments currently at play.
The COVID-19 Pandemic will continue impacting our key markets, however, the effect is mostly on the change in customer buying patterns and expanding customer base effectively. The strain on the restaurant and catering industries is affecting the sustainability of such businesses, some of which are reported to have closed.
In conclusion, I wish every farmer a fruitful greener and resilient 2021 and look forward to engaging you all soon, as we steer the Meatco ship to prosperity for future generations.