MEAT PRODUCTION, PROCESSING & DISTRIBUTION – AN …
MEAT PRODUCTION, PROCESSING & DISTRIBUTION – AN INTEGRATED STRATEGY
OVERVIEW: PRIMARY AGRICULTURAL PRODUCTION
The role of primary agricultural production in developed countries:
Countries with well-developed economies have become extremely rich by optimally combining their Economic Resources in order to add value to primary products. Their governments have facilitated economic growth and development by allowing a free market system to prevail. They have created an “Investor Friendly” investment environment that encourages foreign and local private investment and reduces the flight of skills and capital. Primary agricultural production once played a major role in their economies but today they rely more on high tech and sophisticated secondary adding value, services and processing. However, self sufficient and sustainable food production remains a desirable strategic capability that provides a country with food security and reduces its dependency on other countries. Governments of even well developed countries, whose agricultural sector is relatively small and insignificant, protect their farmers and thus their food security, with legislation, subsidies, import tariffs and duties. They also ensure that their natural, financial and human resources do not lie idle or disappear by encouraging and facilitating development, including agricultural development. South African leaders need to emulate this scenario by providing a safe, secure and low risk investment environment for foreign and local private investment.
The role of primary agricultural production in undeveloped countries:
It is a well-known fact that primary agricultural production (Farming) plays a major role in the economic growth and development of developing provinces and countries like the Limpopo Province and S.A. In S.A. and the Limpopo Province (LP), many economic resources are lying idle and primary agriculture still has a major role to play in poverty alleviation and Economic Growth and Development. The Limpopo Province has all the necessary economic resources, natural resources (land, water, climate, minerals, fauna & flora) financial resources (public, private and institutional capital investment) and Human resources (skilled and unskilled workers) to create Economic Growth and Development from agricultural projects. The local government and the Limpopo Dept. of Agriculture (LPDA) are responsible for creating the structures and mechanisms that will provide a safe, secure and low risk investment environment for foreign and local private investment. This investment environment is the foundation and basis for economic growth and development.
Pertinent international and local trends in agriculture:
A dominant international trend, for many years, has been a consolidation of small farms into medium size farms and latterly into even large, scientific and high tech farms requiring technical, financial and managerial expertise. This trend has been necessitated by stiff competition between agricultural products and shrinking Gross Margins per Ha., particularly for the mass-produced commodities. In S.A., which provides its farmers with less protection than most exporting countries, the size of an “Economic Farming Unit” has been increasing year on year. Only very efficient farmers, in ideal production environments, who can keep production and capital costs down, yields high and spread their fixed costs, can achieve economies of scale and survive. This trend forces many people off the land and into cities and the remaining farmers are forced to look for various ways of increasing their margins or supplementing their income to survive. Taking a job and increasing the size of their farming operation are two options; another is to diversify and integrate (inter-firm co-ordination) horizontally or vertically (forward and/or backwards) in an attempt to increase turnover, reduce risk, add value and spread fixed costs – many farmers choose this option. Agri-related enterprises that were traditionally independently owned and managed are being consolidated, integrated and co-ordinated. For example crop farmers and cattle breeders are now starting their own feedlots, abattoirs and butcheries to add value. Although every one needs to eat, there are many competitive food products competing for the consumers Rand. S.A. is generally lenient with regard to imports and even overseas countries can compete with our locally produced products. It is important to realise that our farmers are in a “Global market” and compete against farmers in other countries, of which the majority, 1st world countries, are heavily subsidised.
The pertinent status of agriculture in S.A. and the Limpopo Province:
South Africa’s estimated population is 40.584m, the Limpopo Province makes up 12% of that at 4.93m, 96,6% of which falls into the Black population group. South Africa is a semi-arid country with an average rainfall of only 497 mm compared to the world average of 860 mm and only 3% of the country receives what is considered “good” rainfall. 60% (73.38m hectare) of the total landmass of 122.3m hectare is grazing land. The Limpopo Province has a total area of 11.96m ha.; 10.548m is farmland (88.2%) and only 1.7m ha. (14,2%) is potentially arable land. The remainder, 8.847m ha. or (85.8%) comprise of 2,644 commercial farming units. The province has ~ 1.203m head (8.9%) out of a total of 13.506m head but it has 10.54% of the grazing – this is due to the generally low carrying capacity as a result of low rainfall. The province is thus generally a poor farming region with a low rainfall and this is highlighted by the low level of maize production in the Province, during 2001/02, of 88,000 tons (0.01%) vs. the country total of 7.225m tons. Large areas are thus suited to extensive livestock production, yet most of the meat consumed in the province is imported from other provinces. The drought years in the late 80;s and 90;s and a depreciating ZAR:US$ have encouraged many cattle farmers to switch to game farming. Game farming is suited to the dry climate of the province, has relatively low operating costs and is an ideal export commodity. The provinces cattle breeding herd has dropped significantly from the 1980 total of 508,000. Feedlot operators have been forced to look further and further a field for weaners and stud farmers have found their market for bulls and breeding stock dwindle. This trend offers an opportunity for emerging farmers to enter the industry, take up the slack and provide the province with its red meat requirements. See Table 1 below.
LPDA Projects – Of the 10.548m ha. farmland in the province, commercial agriculture utilises 7.153m ha. (78%) and developing agriculture, in former homelands, makes up 3.612m ha. (32%). 2.863m ha. (79%) is available in former homelands for grazing land for extensive cattle production. In the past, state owned and managed agricultural projects, have been planned and developed from a purely production point of view. They were “Production Driven” and little attention was paid to market trends and marketing and their ever-changing dynamic environment. The approach was to plant what can grow and what needs lots of labour and not what will provide the best “Gross Margin” per ha. or what is sustainable. These projects were technically well planned, situated and implemented and the Government has spent billions of Rand on thousands of Agri-projects in the Limpopo Province alone. These projects can potentially provide many farming, job and SMME’s for the people of the Limpopo Province if correctly organised and co-ordinated. They need to be planned, managed and implemented with a market in mind if they are to contribute to economic growth and development. In the past, many LPDA agricultural projects were created in an attempt to alleviate poverty. The strategy was to create as many employment opportunities and small farming opportunities as possible. Although well meaning, this strategy has exacerbated poverty and failed dismally because these projects were not self sustainable;
1) Employing too many employees at above the market rate is financial suicide and not sustainable.
2) Providing emerging farmers with small plots to produce low value commodity crops goes directly against the world economic trend of increasing farm size to maintain a viable economic unit. Small farms are only sustainable if very high technology, high value crops are cultivated.
Table 1: Land Utilization in Limpopo Province
|Distribution of |Total Area¹ |Farm Land² |Potential |Grazing |Nature |Forestry |Other³ |
|Land | | |Arable Land | |Conservation | | |
| |Hectare |
|Developing |3 612 400 |3 394 518 |530 700 |2 863 818 |127 200 |6 060 |84 622 |
|Agriculture: | | | | | | | |
|Former Homelands| | | | | | | |
|Commercial |8 348 200 |7 153 772 |1 169 742 |5 984 030 |1 034 400 |59 350 |100 678 |
|Agriculture | | | | | | | |
|Total: |11 960 600 |10 548 290 |1 700 442 |8 847 848 |1 161 600 |65 410 |185 300 |
Notes:
▪ Farm land constitute 88,2% of total land area.
▪ Potential arable land constitutes 14% of total farm land.
▪ Grazing constitute 74% of the total area.
▪ Nature conservation and forestry constitute 10,3% of the total area.
Nature and definition of primary agriculture
Typically the primary agricultural production operations such as cattle farms, chicken farms and pig farms require the highest capital investment yet make the lowest profit margin % (0-5%) and thus the lowest Return on Investment (ROI). For example, the current unfavorable trading conditions in the broiler chicken industry, as a result of very high feed prices, has seen a number of small and larger producers closing. The next functional level of processing and adding value functions, e.g. feed Mills and abattoirs, usually make higher % profit margin (5 – 20%) and ROI and the distribution functions of wholesale and retail shops, makes an even higher profit margin % (40% +) and ROI. Viability studies have shown that Business Units (BU’s), within the same product supply chain (e.g. Beef cattle farms & beef abattoirs) and which are closely linked, vary significantly in their ability to make a profit and thus to remain financially sustainable. This fact poses a serious problem for agricultural development in the province, as many primary producing enterprises are not viable as “stand alone” enterprise.
PROCESS OF INTEGRATION
Essentially the value chain is divided into two pertinent sectors e.g. the primary production or farming enterprise and the secondary value-added or Agri-business enterprise with numerous supplementary enterprises attached to the whole industry. This phenomenon is distinctly manifested in all sectors of agricultural production and the ultimate financial success or viability of primary agricultural production depends almost entirely on the value chain or ensuing level of integration.
The meat production function starts as crop production, progresses to feed manufacture, meat production, then adding value and processing and ends as a marketing and service type enterprise that puts a portion of beef, chicken or pork on a consumer’s plate. These enterprises could be linked and integrated together by market related forces. Each enterprise will be able to buy and sell on the open market once they have met their contractual obligations. Short-term performance related contracts provide stability of supply and sales. Short term shortfalls or over production could be solved by sourcing products or markets elsewhere. These enterprises need to be co-ordinated and synchronised so that they can mesh and work together. This co-ordination function needs to be provided by a Co-ordinating Entity (Service provider) that understands the agricultural sector, the industry and the characteristics of each BU and can facilitate on-going trade between the BU’s. This entity will be a service provider to each BU within each operation.
Integration or Inter-enterprise Co-ordination:
Integration or inter-enterprise co-ordination refers to a process of organising and co-ordinating discrete stages of production into multi-stage Business Units that provide synergy and economic benefits. Two different forces have an important bearing on the organisation of enterprises;
1) New technology has provided opportunities from specialisation that give rise to new economic stages of production or Business Units. A Business Unit is an operating process that starts with a marketable input and ends with a saleable product.
2) Changes in marketing have increased the payoff (A premium) from close co-ordination in order to ensure that products, at different stages, meet the specifications demanded by the market. Products that do not meet these specifications are sold at a lower price or dumped.
In a free market orientated economy such as ours, integration and co-ordination is guided by prices and other factors external to the firm. Internal integration is achieved if there are;
1) Important supplementary or complimentary relations between Business Units.
2) Market control advantages for inputs and/or outputs and financing advantages.
3) Lags or malfunctions in response to market stimuli manifested by competition, outdated technology, product quality or capital rationing.
Integration may be vertical or horizontal;
Horizontal Integration – Co-ordination of two or more units of production in the same economic stage. This achieves economies of scale, reduces risk and input prices. e.g.. Silage and hay making on a dairy farm.
Vertical integration – Co-ordination of successive stages of production and distribution e.g. making cheese from farm milk. Vertical integration may be achieved in many ways and to varying degrees.
1) Forward Contracting usually involves a relatively low level of integration depending on various types of contracts;
1) A Market-Specification Contract – refers to a contract that allows the farmer to manage and produce as he pleases as long as the product produced meets the timing, quantity and quality specifications of the customer.
2) A Production-Management Contract – refers to a higher level of integration and the customer specifies certain inputs and management practices to ensure the product meets the market specifications.
3) A Resource-Providing Contract – refers to even higher integration level where the customer provides inputs of a particular specification (e.g. seed or chicks) and are usually financed by the customer and the customer thus becomes a major source of operating capital.
In all these contracts, quantities, prices or markets are normally guaranteed if the specifications are met. Total Integration involves the co-ordination of successive stages under one decision-making unit.
A common characteristic of all of the various integration models is the necessity of maintaining the “Value Chain” from one Business Unit to the next Business Unit. If this chain is broken integration stops at that point. As a starting point (Phase 1) the proposed strategy integrates market driven wholesale and retail Business Units.
The rationale for integration is to be found in the following factors;
1) Sustainability of primary production enterprises – Due to factors out side of the control of the enterprise, many of the primary production agri-enterprises (cattle farms and broiler farms) and even some adding value and processing enterprises (Chicken abattoirs and feedlots) are not financially sustainable as stand alone projects. To be viable they have to be linked and integrated with further value adding processes or functions. The extra margins created by the more profitable enterprises then subsidise the less profitable enterprises, which are then financially justified.
2) Product Quality - Fresh and frozen meat has to be of high quality to be acceptable. Quality has to be maintained from primary production through to the final product. A “Value Chain” has to be established and maintained throughout the life cycle of each Business Unit. Quality products require quality inputs and if inputs are poor the outputs will also be poor.
3) Product Quantity – To achieve economies of scale, each adding value process has a break-even quantity of core product needed to cover fixed costs. A market based integration strategy helps each Business Unit secure a suitable quantity and quality of product.
4) Sharing of skills and risk reduction – Integration allows primary producers to become involved in the adding value process and marketing and processors to become involved in primary production and thus reduce risk and provide some diversification.
5) Sourcing and leveraging development and working capital – Captive markets are every businesses ideal and an integrated structure links Business Units enabling them to better raise capital.
6) Creating captive markets – Empowerment projects enjoy preferential tender procedures that can provide a captive market. The broiler chicken market is currently over supplied and producer margins are at break-even or negative. Securing a market outlet is vital for success. Assuming quality specifications are met integration provides a captive market for suppliers. The aim of the Frozen Meat Depots and Frozen Meat Shops are to provide an integrated captive market for the Qlity Chicks abattoir and the beef abattoir that in turn provide a captive market for the primary product producers (broilers, feedlots & crops).
This strategy will provide the following major benefits;
1) The strategy links production enterprises to adding value and marketing enterprises and thus makes them financially sustainable.
2) It secures a market for the primary producer and the supply of quality products for the seller.
3) Risk may be reduced and access to finance improved.
4) Emerging entrepreneurs or “Shareholder managers” will have an opportunity to own a small low cost low risk retail business opportunity or a larger wholesale cold storage depot. These enterprises provide employment and equity sharing and better use of capitalassets.
5) Linked to this distribution enterprise are other enterprises that integrate backwards into processing (abattoirs & Feed Mill)) and primary production (feedlots, fish, crop and cattle farms) on redundant state owned projects. These enterprises provide employment and equity sharing.
6) This integration and linking through the market demand generated by the retail and cold storage depots provides many spin-off enterprises – contract transport at many levels, contract ploughing, tannery, shoe & leather goods factory farm services and many more not yet identified.
7) A farmer or businessman who cannot acquire financing because of a small inefficient operation, or a lack of managerial skills, or market uncertainties will benefit greatly from integration. The independence he may have to forego through various contracts with suppliers or distributors is outweighed by the benefits. The current status of LPDA owned projects is dismal – production has ceased, what is produced is of poor quality and cannot be effectively sold and distributors are not interested in the produce because of poor quality, timing and quantity. Integration provides an organisational solution to this situation.
MAIN OPERATIONS AND INDEPENDENT “BUSINESS UNITS”.
The envisaged integration of primary and secondary production processes would have a number of levels that will be approached in phases and sub-phases. Fundamental to the success of the strategy and the whole integration process is that each group of Business Units should be sustainable in its own right and although it will be closely linked to the other groups or Business Units it will not be totally inter-dependent. Inter-firm co-ordination can take a number of forms from simple contracts to total integration. For the purposes of this business strategy a combination of “moderate” contractual links and “complete” integration will be used. The Integrated Strategy will be implemented over a number of phases. Related enterprises will be grouped and linked or integrated according to their product line and ability to be sustainable. The following are the logical groupings for the integrated business units.
1) Crop production – At present current market prices for maize are very unpredictable and causes a lot of uncertainty to the farming community. Although the price of maize has dropped by as much as 300% since the 2004 production season, the prices of other feed ingredients remain at high levels. Even efficient crop farmers with economies of scale are no longer sustainable and are increasingly looking at alternatives to sustain their farming enterprises. A Feed Mill can be loosely integrated with crop farmers as contract growers. Contract growers can be assisted by a feed mill with technical support, seed and even fertilizer. Emerging crop farmers will have a captive market in the mill and the mill provides the farmers with technical support.
2) Feed Mill, Broilers and Breeders – Current feed prices have made breeders and broiler farmers less profitable as prices have not responded to increased feed costs. The feed millers work on a “mark-up on cost” basis and are not affected in the same way by higher feed prices. The broilers and breeders need to own a feed mill to shift the miller’s margin to their operations to make them sustainable. The breeders could have captive markets in broiler hatcheries and broiler production has a captive market in the chicken abattoir. Well-designed and managed feed mills with a captive market can make good profit margins.
3) Cattle farms, feedlots and abattoirs – Cattle farms need to be large with high capital investment in land and livestock and thus provide a relatively low return on investment. The cattle farms will own the feedlot and abattoir and benefit from their high profits. The cattle farms have a captive market in the feedlot and the feedlot has a captive market in the beef abattoir. Feedlots have also been adversely affected by feed prices. Beef feedlots and abattoirs, however, are not expensive to build. The problem with feedlots is the capital required to maintain stock levels and typically medium to large feedlots hold stock of millions of Rand. The solution to this lies in only paying for the animal once it has been sold by the abattoir. This adds approximately 4 months to the cattle farmer’s payment date but as a group reduces working capital requirements significantly and the farmer’s benefits tremendously. The cattle farms benefit in the adding value proceeds of the feedlot and abattoir. Abattoirs turn their money over quickly and are currently making excellent returns. This is due to the high demand and price for the 5th quarter of approximately R500-00.
4) Hatchery – The hatchery business is a mark–up on cost type of business that passes all increases on the purchaser. As the broiler industry is under pressure at present sales are down at present but it does have a captive market of 40,000 chicks per week (~60% of average production) in the broiler farms. The hatchery and broiler farms will be loosely integrated by a supply contract.
5) Chicken abattoir, Frozen meat depots and shops – Chicken abattoirs are capital intensive and trading conditions are tough at present although stocks and thus prices are starting to move. The abattoir needs to piggy-back on the profits generated by a number of frozen meat depots situated at main centres and satellite franchised retail frozen meat shops. Both depots and shops are mark-up type businesses with relatively low risk and potentially high profits.
6) Pig farming and abattoir
7) Meat Processing at Secondary Production Level
(Beef, Pork and Chicken)
8) Packaging and distribution
9) Retail outlets
Ancillary enterprises:
The following supplementary “Spin-off” enterprises could also be established.
1) Transport between various Business Units and operations, from refrigerated trucks, to livestock trucks, to grain and feed trucks.
2) A Tannery to process the hides from the abattoir.
3) A leather products factory adding value to the tanned hides.
4) Leather shops to sell the leather goods (shoes, belts, hats, etc.)
5) Farm services for the Chicken operation – catching and loading, cleaning, washing and disinfecting houses.
6) A small piggery that utilises mortalities and culls from the broiler farms and waste from the mill.
7) Contract ploughing, planting, cultivating and harvesting for the crop farms.
Within each of the five main groups a number of smaller Business Units will be completely integrated. The reason for this grouping into four main operations is as a result of the varying profit potential of each Business Unit, particularly between the primary production Business Units and the processing Business Units. For example in beef production and processing the abattoir and processing facility makes a significantly better profit and return on capital investment versus cattle ranching or feedlots. In the interest of survival and developing primary agriculture the integration link proposed should spread profit evenly between the production orientated Business Units and processing orientated Business Units so that the production Business Units can share in the adding value process and ensure their long term survival. Spreading the profit can be achieved in 2 ways;
1) Manipulating and setting prices between BU’s. This may result in conflict between 2 Business Units and because market prices change continuously it is difficult to control.
2) Establishing companies with integrated Business Units or groups of enterprises that are owned by the primary producers. Cross share holding is also a possibility.
MARKET ANALYSES PER PRODUCTION LINK
THE BEEF MEAT INDUSTRY:
The red meat industry consists of cattle, sheep, pigs, & goats and contributed 12.7% of the total agricultural production during 2000/01. Cattle numbers in S.A. have been virtually static since 1980 at approximately 13.5m head and approximately 2.1m head are slaughtered annually. Beef prices have been moving up steadily from R8.49/kg in 2000 and during 2002 from a low of R11.88/kg (Class A1) in February up to a current price of R15.80/kg. Imports of pork, mutton and beef have been increasing. Total chicken meat production in S.A. in 2000/01 was approximately 797,000 tons per annum and consumption was 843,000 tons or 19.59 kg per capita which exceeds red meat production of 571,000 tons, consumption of 598,000 tons or 13.31 kg per capita. A difference of 6.28 kg/capita in favour of chicken meat.
The beef meat industry in S.A. is made up of the following main enterprises;
1) The beef cattle breeder/farmer
Of the total landmass of the LP, 8.847m hectare is climatically dry grazing land. This physical-biological environment means that cattle farming should be the most important farming activity. This also means that the region is environmentally sensitive and can easily be damaged by poor farming practices – unfortunately this has already happened in many areas. However, if well managed, large areas of natural grassland can provide a low cost sustainable feed source for cattle production.
The Beef Cattle farmer manages a cow herd that produces weaner calves (~ 220 kg live weight) for sale to the feedlots or for self-feeding. This enterprise requires a large grazing farm, is subject to normal agricultural risk, is capital intensive and returns on capital are relatively low. An economic unit is considered to be a breeding herd of between 200 - 250 cows. This farm can also acts as a store of weaners destined for the feedlot. A feedlot needs a regular supply of weaners every month and the farm acts a buffer to supply weaners to the feedlot. It also allows the weaners to grow out on low cost grazing.
Commercial extensive cattle farms need to be large enough to sustain an approximately 200 cow breeding herd to be an economic unit. This must then be matched to the microclimate of the farm and its stocking rate expressed as hectare per animal unit (AU) or head. A stocking rate of 5 ha per animal unit means a 200-cow unit (1.2 animal units) will need 1,200 ha of grazing. This is an average figure that can vary from season to season depending on the amount and frequency of rainfall.
Cattle farm management systems usually consist of 2 systems or a combination of these systems depending on the current rainfall cycle;
1) Fattening and finishing oxen off the veld.
2) Weaner production for sale to feed lots.
Fattening oxen off the veld – This is a flexible, slow turnover system with a relatively small cowherd with many followers (Oxen between 1 – 3 years old). Oxen are fattened off the sweet veld and sold directly to an abattoir. This system is suited to low stocking rate large farms in the lower rainfall, drought prone areas for 2 main reasons;
1) Lower rainfall areas have palatable nutritious veld suited to fattening oxen without any supplements.
2) In times of drought oxen can be easily and quickly sold for slaughter to reduce the number of stock on the farm and leave more grass for the breeding cows (the factory of the farm).
This system can take advantage of a niche export market for organically grown beef. If export is considered to the EU then the abattoir has to be certified for export and has to meet strict EURO-GAP, ISO and HACCP criteria and all meat is de-boned to prevent transporting portions with no export value (i.e. bones).
Weaner production system – This system is a less flexible, faster turnover system with a relatively large cowherd with few followers (only replacement heifers). This system is suited to smaller farms with higher stocking rates, higher rainfall and less drought prone areas. Weaners or long-weaners are sold each year directly to feedlots that fatten for slaughter. A double breeding system (Winter & summer calving) can be used to spread the flow of weaners to the feedlot and reduce the number of breeding bulls needed. A comparison between the weaner and ox fattening system herd compositions, annual sales and costs is tabulated in the index. Under these circumstances and prices the weaner system is preferable. This situation can change as prices change. The weaner system is more vulnerable under drought situations as breeding stock has to be sold to reduce stocking rates.
The proposed integrated system utilises a feedlot to fatten the weaners. The weaner production system has thus been chosen for this model, however, many areas in the province are suited to oxen fattening and the 2 can be done in parallel.
STEER FEEDLOT INDUSTRY
Most beef consumed in S.A. today is stall fed in feedlots. Feedlots are usually situated as close to low cost grain producing areas (low cost feed) and large cities (Consumers) as possible. Today’s fussy mid to high income consumer chooses the leaner, meaty cuts from a young animal (tender) with some “marbling” (fat deposits between muscle fibres) for flavour. The lower income segment of the market prefers the lower priced, more fatty forequarter cuts.
For young growing animals to grow fast and deposit fat they need to be fed intensively on a high-energy ration and not expend energy looking for food (walking and grazing). The practical solution is to confine and stall feed young steers intensively for 3 – 4 months in a feedlot. This confinement means that animals cannot graze and look for their own feed. Feed rations are thus formulated from available ingredients and scientifically mixed and supplemented to provide a balanced feed. The genetic ability of an animal to convert feed into meat is fundamental to the success of a feedlot and is usually expressed as a Feed Conversion Ratio (FCR). The feed conversion ratio is the ratio of feed kg’s consumed to gain 1 kg of meat. The feed conversion ratio depends on the animal’s genetic ability and the composition of the feed – a typical feed conversion ratio is 5 - 6 kg’s feed per kg of gain. Feedlots require good husbandry and management and procuring low cost yet high quality feed is a success factor. Animals need to be weighed regularly to ensure they are on track to achieve the target weight. This weight is often expressed as the Average Daily Gain (ADG). Feedlot animals enter the feedlot soon after being weaned from their mothers. After being dipped, dosed and vaccinated the steers are sorted by gender and size and they then start a 7-day adaptation period, on an adaptation ration, to acclimatise their rumen (stomach) to a new ration. Once completed they are moved to small pens with water and fed ad lib on a full ration.
Bought-in steers weigh on average about 220 kg’s and are ready for slaughter at 400 kg’s, a gain in weight of 180 kg's over 90 – 120 days (Average Daily Gain of 2kg’s – 1.5kg’s). Feed is the major production cost in a feedlot and the more weight that can be gained per animal, while using as little feed and time as possible, to reach a target weight, is the goal. The 2 main factors influencing the profitability of a feedlot fed animal are the 2 main cost items, initial purchase price and feed cost. These 2 factors are called the “market margin” and the “feed margin”.
Feedlots do not require a large amount of land and are often situated on wasteland (non-arable, gravel or stony ground). The ideal site is gently sloping, has a good secure water supply and is close to a low cost feed source. Small feedlots often buy premixed complete feeds from feed companies and larger feedlots try to grow and mix their own rations to keep costs down or add value to crops. The establishment cost of a feedlot depends on many different factors such as the material used level of automation, the necessity to store large volume of feed etc. A feedlot is not very expensive to construct, typically a 1,500 head feedlot will cost anything between R400,000 to R600,000 to construct depending on the sophistication of the feeding system.
The Beef to Grain ratio – The amount in kg’s of grain that can be purchased per kg of beef income. S.A. ratio is currently approximately 8 : 1. The Beef Grain Ratio in the USA is 20:1, significantly more favourable than in S.A..
The market margin - The market margin is the difference in price of the purchase price per kg of the live weaner from the farmer and selling price per kg of the live steer to the abattoir. If the selling price/kg beef is greater than the purchase price/kg beef then the market margin is positive and vice versa.
The feed margin - The feed margin is the difference between the selling price per kg and the cost of feed used to gain that kg.. If the sale price per kg is greater than the total feed cost to add I kg, then the feed margin is positive and vice versa. E.g. The beef feedlot sale price is R9.00/kg live weight and the cost per kg of feed is R1.40/kg, it takes on average 6 kg of feed to add 1 kg of beef (6kg x R1.40 = R8.40), the feed margin is thus R9.00 – R8.40 = R0.60 per kg. A total margin of R108.00 per head that gains 180 kg.
The feedlot owner is thus in one of the following situations
1) Both feed and market margins are negative – the worst situation and will result in a loss.
2) Feed Margin is positive and market margin is negative
3) Feed margin is negative and market margin is positive.
The feed and market margins are positive - the ideal situation.
The abattoir and processing facility
The abattoir slaughters the fed animals and sells the carcasses and tertiary products to butchers and/or wholesale distributors. The “norm” in the abattoir trade is that the profit is made with the 5th quarter (Offal, hide, head & feet). The carcass itself pays the bills and is often sold at a small loss. The 5th quarter value is mainly determined by the hide which can sell for up to R400.00 per unit. The 5th quarter value ranges from R500.00 – R700.00 . An abattoir establishment cost is approximately R15,000 per head throughput (i.e. R300,000 for a 20 head abattoir). The building is not that expensive, however, the chiller rooms are expensive. A good water supply is important (90L/carcass). It is important to build and operate strictly according to health regulations and train the staff properly. The current abattoir selling price per kg is R15.80 per kg for a whole carcass and hindquarter and R15.30 per kg for a fore quarter. A beef abattoir will need to be constructed. Ideally the beef abattoir should be close to the beef steer feedlot to reduce transport costs. This distance should be less than 2 km to allow the steers to be walked to the abattoir without expending too much energy. The loading, travelling and off loading of road transport is a major contributor to stress, weight loss and bruising that reduces quality. The abattoir will be a 25 head per shift abattoir (~ 550 per month). It would be practical to situate the beef abattoir adjacent to the chicken abattoir that has considerable freezer capacity that could be shared. It is recommended that the abattoir is situated at either Lebowakgomo or near Polokwane.
Beef processing and packaging
The beef processing facility that will be used as the bulk beef processing and portioning facility will be attached to the abattoir with its own freezer units. This facility consists of Stainless Steel worktables, meat saws, portioning and packaging equipment and receives carcasses from the abattoir portions, processes and packages the meat into the different cuts. Expensive cuts are sold to up market stores, restaurants and butcheries. The more affordable cuts and tertiary products are sold to the Frozen Meat Depots.
Wholesale distributors - Purchase carcasses from the abattoirs, cut up the carcasses for fast food outlets, restaurants and retail consumers for home use. In the rural areas the main demand is for the cheaper fore quarter cuts (Neck, shin brisket etc. and tertiary products) while the urban areas demand the more expensive hindquarter cuts (Rump, fillet etc.). Generally cutting up costs are R2.50 – R3.00 per kg. A whole carcass, cut into family cooking portions, roasts, steaks, chops, stewing, mince, wors, soup, dogs bones etc. can be purchased for R19.00 per kg.
[pic]
Retail distributors (Butchers, Restaurants, hotels, caterers and lodges, stores, and fast food outlets) further add value by cooking and preparing meals for consumers. In the rural areas the demand is for a low cost tasty meal. “Pap en vlies” and the “buy ‘n braai” concept are very popular.
The cattle hide Industry is a spin-off of the beef industry;
The hide market in S.A. is dictated by the export market demand for tanned leather. 90% of S.A.’s leather is exported to Italy where it is processed further and cut into very thin slices for use in high value clothing, furniture and motor car seats. A cowhide can be cut into 4 – 5 slices. This value-added leather is then imported back into S.A. for use in our furniture clothing and car manufacturing industry. The reason why this is not done locally is due to economies of scale and the capital cost of the equipment needed to slice and process the skins. The main tanneries in the country are to be found in Port Elizabeth, Brits and Silverton. Area agents in the rural areas go around and buy wet “green” skins or wet “salted” skins from small abattoirs and farmers. Every week a Regional agent collects these skins by truck and finds the best price from the tannery for the Area agent. The tannery tans the skin and bulk packs for export to Italy.
Current prices FOB abattoir are;
1) Green skins sell for R12.00 – R14.00 per kg collected or approximately R360.00 – R420.00 per 30 kg skin.
2) Salted skins sell for R14.00 – R16.00 per kg collected or approximately R420.00 – R480.00 per 30 kg skin.
Average skin weight for a feedlot fed animal is 30 kg’s per skin. Prices vary up and down by approximately 10% during the year. Because 90% of hides are exported, the price is Rand US$ dependant. Tanneries sell various different grades of unsliced leather to local manufactures of leather goods – veldskoens, belts, hats, saddles, harnesses, collars, key rings, balls etc. Many of these products can be hand made in small one-man businesses (SMME’s) and could provide many SMME and work opportunities.
THE CHICKEN MEAT INDUSTRY:
Total chicken meat production in S.A. in 2000/01 was approximately 797,000 tons per annum and consumption was 843,000 tons or 19.59 per capita which exceeds red meat consumption of 871,000 tons or 19.37 kg per capita. The chicken meat production industry in S.A. is characterised by a small number of large production operations that produce 77% of all chicken with Rainbow Chicken being the largest followed by Early Bird. Chicken meat is the single most important contributor (~ R6,019m per annum) to agricultural production in S.A. The medium to large operations are all high tech sophisticated enterprises that compare favourably with any 1st world country. The smaller operations use varying degrees of technology from relatively basic to very sophisticated automated controlled environment systems. Generally broiler production can be considered an intensive farming operation characterised by low margins per unit, high risk and high sensitivity to feed prices and thus the Rand : US$ exchange rate. Small producers, often part-time chicken farmers, enter and exit the market freely depending on the price cost ratios at the time. There is a large cash market for live chickens, mainly in rural areas, as better value per kg is achieved. Currently a tariff protects the local industry as US; Brazil & EU farmers can produce at lower cost due to subsidized feed costs. During the past year many smaller and a few large broiler operations have closed due to adverse markets and trading conditions. Prices have strengthened slightly to R11.30 per kg and are likely to hold for some time.
The chicken meat industry in S.A. is made up of the following main enterprises;
Broiler day old chick production (Breeders & Hatcheries) – Day old broiler chick production is a specialised farming and hatching operation that takes a high level of management. Broiler chick production enterprises are usually totally integrated with a hatchery but contract growing is practised. Breeders in a ratio of approximately 3 hens to 1 cock are mated and hens produce approximately 115 grade 1 chicks per cycle. Fertile eggs are incubated over a 19 –21 day period, hatched, graded, medicated, packaged and sold to broiler farmers. The current prices for chicks are R2.60 VAT excl.
Broiler farmers – Broiler production is the intensive rearing of broiler chicks from day old up to their target weight of 1.7kg live weight (1.2 kg's dressed what.), maximum growth rate (Daily Gain), now at approximately at 38 days. Feed costs make up approximately 75% of production costs and profitability is very sensitive to all feed related factors such as price, quality, feed conversion ratios, health, daily gains etc. Birds are sold live to hawkers or to an abattoir for slaughter.
Broiler abattoir – Broiler abattoirs and farms are often integrated into one operation where the farmer is adding value. Alternatively birds are produced under varying types of contracts. Profitability at the abattoir is dependent on the quality on the birds delivered and keeping shrinkage and overheads (Particularly labour and energy costs) down. Abattoirs are expensive to establish and require a constant throughput throughout the year to achieve break-even. Having a secure market for the birds slaughtered, even during tough times, is a highly desirable and a KSF. Supply contracts and/or further integration into marketing channels are considered essential to provide SBU’s with secure markets at periodically fixed prices. During adverse trading conditions integrated BU’s can assist each other by cross subsidisation.
Breeder & Broiler Farmers – It is recommended that the breeder and broiler farmers operate individually as sole proprietors but organize themselves into a buying and selling association to glean benefits from bulk purchases and product quantity. The reason for remaining independent is to protect and reward the good farmers and prevent poor farmers from “piggy backing” on the good farmers. These Business Units do not need private investors as the LPDA is in the process of structuring a Grant/Loan scheme to assist these farmers become established. The coordinating entity will assist these farmers to work together as a group and establish the contracts between the farmers and the LPDA, hatchery or abattoir.
Chicken Abattoir
The integration of the Frozen Meat Depot includes being a major customer of an existing, ex LPDA, chicken abattoir (t/a Qlity Chicks) and adding value facility. This 70,000 bird per week abattoir is situated in the Lebowakgomo Industrial sites ~ 60km South of Polokwane. The LPDA is currently busy with a programme to revitalise the hatchery, broilers and abattoir in an IBP. The existing infrastructure of the abattoir is significant and all in place. Some machinery and equipment needs to be serviced, upgraded and replaced. Refer to the attached cost projections. This is expected to be completed by the end of April 2003.
THE FEED AND CROP INDUSTRY
The feed operation is made up of crop producers that supply the raw material, millers who store, mix and formulate feeds and distributors (wholesale and retail)
The Feed Mill
The feed milling industry in S.A. is dominated by a number of large milling companies such as Meadow Feeds, Epol and OTK Feeds and a number of medium and smaller millers who target niche markets and survive by keeping fixed costs low. The establishment of a mill is capital intensive and largely depends on whether a fully computerised and automated operation is desired or a more manual labour intensive operation will suffice. However, certain operations cannot be done manually as grams (e.g. growth hormones) need to be evenly mixed with tons of raw materials. The balancing of the ration to minimise costs while complying with feed specifications is a specialised function. Computerised Linear Programming techniques are used to determine lowest cost formulations. The miller needs to know the cost of the raw material and its chemical composition. The computer is programmed to provide the least cost combination of a number of feed raw materials within the constraints of the feed ration specifications. The programme then tells the miller the quantities and proportions of each raw material to be mixed together. The raw material cost typically makes up 80% of the total cost while operating costs make up the 20% balance. The viability of a mill is largely dependent upon the cost of capital and the cost:quality ratio of the raw materials purchased. Good quality raw materials are the basis for good quality and value for money feed. Good quality feed is thus dependant on the ability of crop farmers to provide a constant supply of good quality raw materials. This is the starting point of the “Value Chain” for the proposed integration strategy. Good quality raw materials = good quality feed = good quality broilers and steers = good quality meat = a satisfied consumer.
Crop Farmers
The crop farms Business Units should be large economic units to achieve economies of scale. Farmers of small units should be co-ordinated into large units by means of a Pty Ltd. If the number of farmers exceeds 50 then they will need to be organized into a Farmers Trust, which will own shares in a Pty Ltd. Ex small holder farmers can become the crop Business Unit or large unit employees. Either private investors need to be invited or the LPDA will need to assist to finance these BU’s. Employee Trusts and Local Community Trusts can also be involved as shareholders or lessors that lease land to the Business Unit. A number of large crop farms can form an association to buy in bulk and sell in bulk to the Feed Mill. The coordinating entity will assist these farmers to work together as a group and establish the contracts between the farmers and the LPDA and the Feed Mill. Producing the desired quantity of a good quality raw material at a market related price is essential to the sustainability of the crop farmer and the feed mill. The crop farmer and the feed mill will be closely linked by contractual agreements to sell and buy.
It is envisaged that crop farmers will be both irrigation farmers (Maize, Soya and Lucerne) and dryland farmers (Sorghum and sunflower). Table ….shows the current relative price and cost structures for each crop. Ideally a crop rotation with a legume crop at least every second season is desirable. The crop Business Units create contract ploughing, planting and harvesting spin-off’s
ANIMAL FEED PRODUCTION INPUTS AVAILABLE IN LIMPOPO PROVINCE
The following raw materials are available in the Province. Quantities and quality will be determined by prevailing weather conditions. Apart from Lucerne most of the required crops could be cultivated under dryland conditions by commercial and emerging farmers.
Table 2: Estimated Raw material availability in the Province
|Raw Material |Estimated Production Level |Estimated Requirements |National Production |
| |(2004) (1000t) |(1000t) |(1000t) |
|Cottonseed¹ |4.75 |n/a |72.25 |
|Hominy Chop² |19.15 |13.6 |176.0 |
|Lucerne Hay |4.5 |5.0 |79.0 |
|Maize |121.0 |226.550 |9 483.0 |
|Sorghum |22.0 |91.0 |373.0 |
|Sunflower Seed³ |37.0 |39.0 |648.0 |
Notes: ¹ Including oilcake & fulfat cotton
² Including Maize by-products
³ Sunflower seed, oilcake & hulls.
Estimated demand for animal feed in Northern Province
The major consumers of animal feed in Northern Province are beef feedlots, egg and day-old chicken producers, broiler farms and pig farms. There is no significant occurrence of other animal production, largely because of climatic conditions. Total feed requirements for the Province are estimated at 453 100tons. Feed requirements per type of production activity are indicated below:
Table 3: Estimated Production and Feed requirement per activity
|Production Activity |Production |Feed (t) | |
|Beef Feedlots (tons dressed mass) |65 000 |243 100 | |
|Broiler Production (tons dressed mass) |45 000 |90 000 | |
|Egg Production (million doz. Eggs) | 300 |50 000 | |
|Day-old Chicks (million day-old chicks) | 31.2 |17 500 | |
|Pork Production (tons dressed mass) |15 000 |52 500 | |
|Total: | |453 100 | |
Table 4: Composition of Animal Feed Requirement in Limpopo Province
|RAW MATERIAL | |TONNAGE (1000) |
| |INCLUSION RATE (%) | |
|Yellow Maize |50,0 |226 550 |
|Hominy Chop |2,5 |11 328 |
|Lucerne Hay |1,10 |4 984 |
|Maize By-Products |2,17 |9 832 |
|Oilcake & By-Products |15.28 |69 234 |
|Sorghum (Animal Feed) |0.02 |91 |
|Other (Imports)¹ |28,93 |131 082 |
|Total: |100,0 |453 100 |
Although more than 80% of animal feed ingredients are imported into the Province, it is estimated that at least 50% of all feed applied for animal production and consumed in the Northern Province, would be mixed at the site of production.
The annual demand for maize for human and animal consumption in the Province is estimated at 750 000 metric tons of which less than 30% is locally produced.
Maize is predominantly produced on a dryland cropping system which is dependent on the annual rainfall. Yields are therefore relatively low. Introduction of emerging farmers to more land, support services, extension services and perhaps finance could change the situation and also render an opportunity to improve the home grown supply of maize.
SOUTH AFRICAN FEED INDUSTRY
NATIONAL ANNUAL FEED MANUFACTURING
The South African animal feed Industry in the year 1999 had a turnover of R7 billion generated by sales of 7,2 million tonnes of feed. The organized feed sector represents 4.1 million tonnes with a further 3,5 million tonnes of feed being mixed by the informal sector, including feedlots. Based on these figures, the animal feed industry is one of the largest individual organizations serving South African agriculture.
RAW MATERIAL UTILISATION IN 2003/2004 BY AFMA MEMBERS
Table 5 shows raw material usage for 2003/2004. The average inclusion rates for the various raw materials as a percentage of the total feed sales are also provided. It must, however, be noted that not all raw materials are used in all feeds. The inclusion rate of maize or Soya oilcake could therefore be much higher or lower in specific dairy or broiler rations. Only raw materials with an inclusion rate of more than 1%, is shown in table 2.
TABLE 5 - RAW MATERIAL USAGE (APRIL 2003 - MARCH 2004) - AFMA MEMBERS ONLY
|RAW MATERIAL / GRONDSTOF |TOTAL (T) |Inclusion rate |
| |2003/2004 |2003/2004 |
|Fish meal |114,402 |2.73% |
|Fulfat Soya |88,950 |2.12% |
|Hominy chop |104,250 |2.49% |
|Limestone grit |56,565 |1.35% |
|Limestone powder |68,660 |1.64% |
|Lucerne hay |46,306 |1.10% |
|Maize |2,132,551 |49.87% |
|Maize products |91,052 |2.17% |
|Molasses |142,190 |3.39% |
|Mono calcium phosphate |24,937 |0.59% |
|Poultry by-product |53,702 |1.28% |
|Salt |28,586 |0.68% |
|Soya Oilcake |364,882 |8.70% |
|Sunflower seed, oilcake and hulls |275,823 |6.58% |
|Wheaten bran, flour and straw |271,985 |6.49% |
|Other Raw Materials |249,902 |5.96% |
|TOTAL |4,114,743 |98.14% |
|Feed sales for the period |4,192,540 | |
TABLE 5.1 - USAGE OF MAIZE PRODUCTS BY AFMA MEMBERS (TONNES):
1 APRIL 200 1 TO 31 MARCH 2004
| |2001/2002 |% Inc. |2002/2003 |% Inc. |
| | 2003/04 | crushing | rate (seed) % | 2003/04 |
|Sunflower (1,2) | 642,610 |800,000 |42% | |
| | | | |336,000 |
|Groundnut (1,2) | 88,415 | 3,300 |53.5% | |
| | | | |1,766 |
|Soya (1,2,6) | 136,520 | 7,500 |80% | |
| | | | |6,000 |
|- Full fat (2) | - | 141,600 |80% | |
| | | | |113,280 |
|Cotton (3) | 27,284 | 22,592 |50% | |
| | | | |11,296 |
|- Full fat (4) | | 4,692 |50% | |
| | | | |2,346 |
|Canola (1,2) | 40,770 | 20,900 |55% | |
| | | | |11,495 |
|- Full fat (4) | - | 5,800 |55% | |
| | | | |3,190 |
|Lupins - Full fat (1) | 4,040 | 4,040 |100% | |
| | | | |4,040 |
|TOTAL LOCAL OILCAKE | | 1,010,424 | | |
| | | | |489,413 |
Sources:
|1. |National Crop Estimates Committee (19 August 2004). |
|2. |SAGIS - Monthly reports 26/11/03, 26/02/2004, 30/4/2004, 26/05/2004, 28/6/2004. |
|3. |Cotton SA. These figures include seed that entered the country from SACU as lint for processing. (Website: .za) |
|4. |Only fullfat used by AFMA members is included in these figures. |
|5. |According to the SAGIS' report of 26/02/2004, 800 000 tonnes of sunflower were available for animal feed and crushing. 1 500 |
| |tonnes were imported. 900 tonnes were for human consumption. |
|6. |2 700 tonnes for seed. |
TABLE 6.1 - OILCAKE IMPORTS (Tonnes) - 1 APRIL 2002 - 31 MARCH 2003
|Cake / Seed |Tonnes |Conversion |Oilcake |
| |Seed +oilcake |rate |2002/03 |
|Sunflower oilcake | 16,599 |100% | 16,599 |
|Sunflower seed | 18,523 |42% | 7,780 |
|Groundnut oilcake | - |100% | - |
|Soya oilcake | 477,814 |100% | 477,814 |
|Soya beans | 24,377 |80% | 19,502 |
|Cotton oilcake | 73,760 |100% | 73,760 |
|Cotton seed (1) | 44,825 |50% | 22,413 |
|Other seeds * | 542 |50% | 271 |
|Other oilcakes * | 13,910 |100% | 13,910 |
|TOTAL IMPORTS | 670,350 | | 632,048 |
|Local Production (Ex Table 4) | | | 489,413 |
|GRAND TOTAL - Table 4 + 4.1 | | |1,121,460 |
Sources:
Department of Customs & Excise
1. Cotton SA
* Other oilcakes / seeds: Copra, Linseed, Rape & Palm
TABLE 6.2 - SUMMARY OF TOTAL OILCAKE AVAILABLE (Tonnes) FOR MARKETING:
1 APRIL 2001 - 31 MARCH 2004
|Oilcake |2001/02 |% |2002/03 |
|Sunflower |307,440 |360,379 |17.22% |
|Soya |705,352 |616,596 |-12.58% |
|Cotton |131,660 |109,815 |-16.59% |
|Groundnut |8,132 |1,766 |-78.29% |
|Canola |20,886 |14,685 |-29.69% |
|Lupin |25,226 |4,040 |-83.98% |
|Others oilcakes |11,700 |14,181 |21.21% |
|Total |1,210,396 |1,121,460 |-7.35% |
Sorghum
According to the Crop Estimates Committee report of 20 July 2004 the expected crop for 2003/2004 will be 302 870 tonnes.
Table 7 gives the actual usage for 2002/2003 and for 2003/2004 (SAGIS) and the estimated usage for 2004/2005 based on Grain South Africa’s calculation.
In view of the information received, the crop estimate and the local requirements, it seems unlikely that any sorghum will be imported in 2004/05.
TABLE 7 - USAGE OF SORGHUM (TONNES) FROM 1 APRIL 2002 - 30 APRIL 2004 AND ESTIMATED USAGE FOR 2004/2005
| |USAGE 2002/03 |USAGE 2003/04* |ESTIMATED USAGE 2004/05** |
|Malting |95,400 |95,000 |95,000 |
|Meal |64,900 |63,100 |60,000 |
|Rice and grit |14,100 |10,800 |10,000 |
|Animal Feed |20,700 |8,700 |51,500 |
|Pet Foods |1,200 |1,400 |1,500 |
|Exports *** |66,200 |48,800 |55,000 |
|Released to end consumers |900 |1,400 |1,000 |
|Withdrawn by producers |10,600 |3,900 |9,000 |
|TOTAL REQUIREMENT |274,000 |233,100 |283,000 |
|Imports |75,100 |28,800 |0 |
|Crop estimate (1) | | |317,370 |
Sources:
* SAGIS (26/05/2004)
** Grain South Africa (Received by telephone on 23 August 2004 - adapted) / Website 20 Augustus ‘04
*** Exports include both products and grain
1) National Crop Estimates Committee (19 August 2004)
FEED SALES: 2003/04
Feed sales by AFMA members went through the 4 million tonne barrier for the fifth time in history and in view of the new members that joined AFMA since 1 July 2004, feed production should not fall below 4 million tonnes again. The next target would be 4,2 to 4,5 million tonnes per annum.
Last year we reported on the sharp price increase in certain feed categories and it was ascribed to the higher raw material costs. In the meantime the rate of increase in raw material prices has slowed down According to Table 8, beef and sheep feed sales kept on growing for the fourth consecutive year. On the concentrate side, we observed growth in the categories for beef, dairy, sheep and layers.
TABLE 8: FEED SALES (Tonnes): FROM 2000/2001 TO 2002/2004 (APRIL - MARCH)
|TYPE OF FEED |2000/01 |2001/02 |2002/03 |2003/04 |% Growth |
|Dairy |530,922 |604,761 |574,754 |649,817 |13.06 |
|Beef and sheep |159,261 |180,741 |230,330 |284,841 |23.67 |
|Pigs |190,729 |208,624 |212,389 |165,165 |-22.23 |
|Layers |703,162 |718,000 |692,106 |670,475 |-3.13 |
|Broilers |1,753,717 |1,800,973 |1,921,470 |1,943,709 |1.16 |
|Broiler breeders |288,188 |278,397 |296,024 |284,214 |-3.99 |
|Horses |21,642 |19,544 |20,684 |21,495 |3.92 |
|Dogs (D&W) |120,947 |82,776 |38,258 |34,805 |-9.03 |
|Ostriches |49,913 |49,383 |38,288 |32,341 |-15.53 |
|Other mixtures |19,214 |19,063 |10,689 |9,951 |-6.90 |
|Aquaculture |1,870 |1,937 |1,854 |1,711 |-7.17 |
|CONCENTRATES | | | | | |
|Other concentrates |2,347 |3,892 |6,252 |8,666 |38.61 |
|Beef finisher |15,580 |13,647 |12,197 |22,166 |81.73 |
|Dairy + urea |37,393 |26,893 |16,154 |21,489 |33.03 |
|Dairy – urea |7,303 |5,759 |5,112 |7,762 |51.84 |
|Sheep finisher |8,773 |3,746 |4,942 |10,173 |105.85 |
|Layers |2,801 |3,174 |7,878 |10,141 |28.73 |
|Broilers |7,045 |5,627 |3,553 |2,949 |-17.00 |
|Ostriches |112 |122 |64 |26 |-59.38 |
|Horses |5 |0 |0 |0 |0 |
|Ruminants – other |3,361 |1,261 |1,100 |1,073 |-2.45 |
|TOTAL |3,939,506 |4,039,058 |4,104,693 |4,192,540 |2.14% |
|Growth% |-4.29% |2.53% |1.63% |2.14% | |
FEED SALES PER PROVINCE: 2003/04
Table 9 shows the feed sales of AFMA members per province. As previously mentioned, figures have in certain cases been consolidated per province or area in order not to disclose the figures of particular feed mills.
It must be kept in mind that feeds are sold over provincial and even national borders. No information on those movements is available.
The market share for the various provinces changed less than 1% from the previous year, except for the Eastern Cape where sales increased from 154 750 to 233 673 tonnes. The major increases were in dairy, layer and broiler feed sales.
TABLE 9: ANIMAL FEED SALES PER PROVINCE - 1 APRIL 2002 to 31 MARCH 2003 (AFMA members only)
| |WC |EC |KZN |
|Broilers |2,239,719 |2,554,885.00 |87.66% |
|Layers |747,821 |860,000.00 |86.96% |
|Dairy |796,072 |1,545,264.00 |51.52% |
|Beef & Sheep |645,602 |1,858,000.00 |34.75% |
|Pigs |213,020 |711,031.00 |29.96% |
|Dogs |34,805 |219,100.00 |15.89% |
|Horses |21,495 |121,000.00 |17.76% |
|Ostriches |32,471 |130,000.00 |24.98% |
|Aquaculture |1,711 |1,854.00 |92.29% |
|Total |4,732,716 |8,001,134 |59.15% |
|Sources: Dr Munro Griessel (2004) | | |
| Dr Erhard Briedenhann (2004) | | |
From the illustrations and figures above one can conclude that the feed industry in Limpopo represents less than 10% of the total feed manufacturing industry. Most of all raw material used in the manufacturing process has to be imported from other regions.
THE BROILER INDUSTRY IN PERSPECTIVE
1 National Production Statistics
The South African broiler industry produces an estimated 12 million units per week (600 million units per annum). Formal producers produce just over 10 million units per week and the balance is produced by a large number of small informal farmers. The 8 largest producers account for an estimated 80% of the formal sector’s output. These producers include Rainbow (3,0 million units per week), Early Bird (2 million units), medium sized firms, e.g. Daybreak Farms, County Fair and Agri Chicks (1 million units) and smaller producers such as Chubby Chick and Lemoenkloof (0,5 million units). Smaller producers with outputs of about 100 000 units per week include Limpopo based companies such as Mikes Chicken, Bush Valley and Spif.
During the early 1990s, production levelled off at about 7 million units per week, but since 1995 a strong increase in demand was experienced raising broiler production (in the formal sector) to 10,3 million units per week in 1999. Since 1999 the production has stabilised at this level in the formal sector. Most of the formal sector output is slaughtered and processed for the market whilst the informal sector supplies largely live chicken. Large and medium sized producers have their own abattoirs, ranging in size from 0,5 million units to 1,5 million units per week. It is clear that the Lebowakgomo Abattoir is small in comparison, representing only about 5% of the capacity of large processing units.
2 Estimated Size of Limpopo Province Market
The Limpopo Province represents around 3 – 4% of South Africa’s economic output and retail trade activity. It does, however, comprise nearly 12% of the total population of the country, a fact which implies:
❑ One of the lowest per capita disposable income and expenditure profiles of all provinces.
❑ Probably a relatively large rural and informal trade sector.
❑ Considerable food production for own consumption in the case of people residing on farms and in informal settlements.
Based on this broad economic and demographic perspective, it is estimated that the Limpopo Province accounts for about 5% of the national demand for broilers. This yields a total weekly demand of 600 000 units and a formal sector market (e.g. slaughtered and processed) of approximately 500 000 units per week. This gives a per capita consumption of ± 8 kg/annum compared to the national average of about 18 kg/annum for South Africa.
A comparison of per capita consumption figures in other countries for poultry meat indicates considerable upward market potential should economic growth and subsequent disposable income growth is forthcoming.
Table 11: Production and Consumption of chicken meat
|Year |SA Production (t) |Imports |Total |SA Consumption |Limpopo Production – |
| | |(t) |(t) |(t) (kg) |Est. (t) |
|2002 |924.85 |93.9 |1009.26 |1000.1 (21.85) |46.25 |
|2003 |899.6 |153.1 |1047.87 |1038.88 (22.41) |45.00 |
|2004 |894.3 |168.05 |1058.38 |1049.44 (22.40) |45.00 |
Note: Differences are accounted for in terms of export and losses.
TABLE 11.1: PER CAPITA CONSUMPTION: POULTRY MEAT
(kg per head)
| |1995 |2000 |
|Argentina |22.8 |27.3 |
|Brazil |25.9 |30.6 |
|Chile |23.3 |28.0 |
|Mexico |19.9 |23.5 |
|Portugal |25.3 |29.5 |
|USA |44.0 |49.9 |
|RSA |16.0 |18.0 |
Source: IMS – GIRA
It is interesting to note that poultry meat consumption has increased in all countries listed in Table 11.1 above.
3 Price Trends
In the mid 1990s, prices for chicken products came under severe pressure with increased export and dumping from especially the USA and Brazil. Prices remained at around R7/kg when the local industry was forced to compete with cheap imported product. At its peak, approximately 110 000 tons (80 million chicken equivalents) were imported into the local market. Following tariff protection and anti-dumping legislation that was introduced in July 2000 broiler prices started increasing and at the same time the threat of imports diminished. Table 2.2 provides an indication of price trends since 1998. Currently imports remain at about 70 000 tons per annum with exports representing a small volume of 8 000 tons per annum. During the year 2000, prices increased from around R7,30/kg in April 2000 to R8,90/kg in December 2000, this reached a high of about R9,50/kg in September 2001 but since then prices have moved sideways and have even declined slightly.
Broilers – An Industry under Pressure
Recent price trends in selected agricultural products indicate that the broiler industry is currently under severe cost strain. The table below gives historic prices for some products.
TABLE 11.2: PRICE COMPARISON OF SELECTED AGRICULTURAL PRODUCTS
|Year |Yellow Maize |Beef |Mutton |Chicken |
| |Delivered | | | |
| |(R/ton) | | | |
| | |Producer price (c/kg)|Retail price (c/kg) |Producer price (c/kg)|Retail price (c/kg) |
|2002 |110.96 |11.23 |121.26 |120.15 (2.59) |12.21 |
|2003 |127.0 |21.5 |147.91 |146.64 (3.13) |13.97 |
|2004 |134.43 |27.7 |161.67 |160.32 (3.39) |14.79 |
Note: Differences are accounted for in terms of export and losses.
Exports
Exports are mostly to African countries e.g.: Namibia and Botswana and the Far East. Due to the existence of African swine fever, South African exports to the EU are currently prohibited.
Processing
Like beef, value adding here mainly involves slaughtering. Commercial pork production is highly intensified and accounts for at least 95% of total pork production. The pork industry could almost benefit immediately from a process of integration as the necessary capacity for slaughtering and processing already exists in the Province. A high capacity dual purpose abattoir in Polokwane is currently not in operation.
The majority of pigs are slaughtered outside the boundaries of the Province and the requirements of the Enterprise Processing plant is imported from outside the region. Substantial gross margins are sacrificed in this process and the situation could also be detrimental to future growth and perhaps the introduction of small and emerging pig farmers.
The Beef Fattening and Processing Industry
Most beef consumed in S.A. today is stall fed in feedlots. Feedlots are usually situated as close to low cost grain producing areas (low cost feed) and large cities (Consumers) as possible. Today’s fussy mid to high income consumer chooses the leaner, meaty cuts from a young animal (tender) with some “marbling” (fat deposits between muscle fibres) for flavour. The lower income segment of the market prefers the lower priced fattier forequarter cuts.
For young growing animals to grow fast and deposit fat they need to be fed intensively on a high-energy ration and not expend energy looking for food (walking and grazing). The practical solution is to confine and stall feed young steers intensively for 3 – 4 months in a feedlot. This confinement means that animals cannot graze and look for their own feed. Feed rations are thus formulated from available ingredients and scientifically mixed and supplemented to provide a balanced feed. The genetic ability of an animal to convert feed into meat is fundamental to the success of a feedlot and is usually expressed as a Feed Conversion Ratio (FCR). The feed conversion ratio is the ratio of feed kg’s consumed to gain 1 kg of meat. The feed conversion ratio depends on the animal’s genetic ability and the composition of the feed – a typical feed conversion ratio is 5 - 6 kg’s feed per kg of gain. Feedlots require good husbandry and management and procuring low cost yet high quality feed is a success factor. Animals need to be weighed regularly to ensure they are on track to achieve the target weight. This weight is often expressed as the Average Daily Gain ADG. Feedlot animals enter the feedlot soon after being weaned from their mothers. After being dipped, dosed and vaccinated the steers are sorted by gender and size and they then start a 7-day adaptation period, on an adaptation ration, to acclimatise their rumen (stomach) to a new ration. Once completed they are moved to small pens with water and fed ad lib on a full ration.
New steers weigh on average about 220 kg’s and are ready for slaughter at 400 kg’s, a gain in weight of 180 kg's over 90 – 120 days (Average Daily Gain of 2kg’s – 1.5kg’s). Feed is the major production cost in a feedlot and the more weight that can be added to the animal, while using as little feed and time as possible, to reach a target weight, is the goal. The 2 main factors influencing the profitability of a feedlot fed animal are the 2 main cost items, purchase price and feed cost. These 2 factors are called the “market margin” and the “feed margin”.
Feedlots do not require a large amount of land and are often situated on wasteland (non-arable, gravel or stony ground). The ideal site is gently sloping, has a good secure water supply and is close to a low cost feed source. Small feedlots often buy premixed complete feeds from feed companies and larger feedlots try to grow and mix their own rations to keep costs down or add value to crops. The establishment cost of a feedlot depends on many different factors such as the material used level of automation, the necessity to store large volume of feed etc. A feedlot is not very expensive to construct, typically a 1,500 head feedlot will cost anything between R400,000 to R600,000 to construct depending on the sophistication of the feeding system.
The Beef to Grain ratio – The amount in kg’s of grain that can be purchased per kg of beef income. S.A. ratio is currently approximately 8: 1. The Beef Grain Ratio in the USA is 20:1, significantly more favourable than in S.A.
The market margin - The market margin is the difference in price of the purchase price per kg of the live weaner from the farmer and selling price per kg of the live steer to the abattoir. If the selling price/kg beef is greater than the purchase price/kg beef then the market margin is positive and vice versa.
The feed margin - The feed margin is the difference between the selling price per kg and the cost of feed used to gain that kg.. If the sale price per kg is greater than the total feed cost to add I kg, then the feed margin is positive and vice versa. E.g. The beef feedlot sale price is R9.00/kg live weight and the cost per kg of feed is R1.40/kg, it takes on average 6 kg of feed to add 1 kg of beef (6kg x R1.40 = R8.40), the feed margin is thus R9.00 – R8.40 = R0.60 per kg. A gross margin of R108.00 per head that gains 180 kg.
The feedlot owner is thus in one of the following situations
1. Both feed and market margins are negative – the worst situation and will result in a loss.
1. Feed Margin is positive and market margin is negative
2. Feed margin is negative and market margin is positive.
The feed and market margins are positive - the ideal situation.
Table 13: Production and Consumption of Beef
|Year |SA Production (t) |Imports |Total |SA Consumption |Limpopo Production – |
| | |(t) |(t) |(t) (kg) |Est. (t) |
|2002 |579.02 |45.19 |613.02 |607.23 (13.10) |58.0 |
|2003 |635.4 |53.33 |663.47 |657.12 (14.03) |67.0 |
|2004 |624.95 |60.05 |679.86 |673.61 (14.26) |65.0 |
Note: Differences are accounted for in terms of export and losses.
The Abattoir and Processing Facility
The abattoir slaughters the fattened animals and sells the carcasses and tertiary products to butchers and/or wholesale distributors. The “norm” in the abattoir trade is that the profit is made with the 5th quarter (Offal, hide, head & feet). The carcass itself pays the bills and is often sold at a small loss. The 5th quarter value is mainly determined by the hide which can sell for up to R400.00 per unit. The 5th quarter value ranges from R500.00 – R700.00 . An abattoir establishment cost is approximately R15,000 per head throughput (i.e. R300,000 for a 20 head abattoir). The building is not that expensive, however, the chiller rooms are expensive. A good water supply is important (90L/carcass). It is important to build and operate strictly according to health regulations and train the staff properly. The current abattoir selling price per kg is R15.80 per kg for a whole carcass and hindquarter and R15.30 per kg for a fore quarter. A beef abattoir will need to be constructed. Ideally the beef abattoir should be close to the beef steer feedlot to reduce transport costs. This distance should be less than 2 km to allow the steers to be walked to the abattoir without expending too much energy. The loading, travelling and off loading of road transport is a major contributor to stress, weight loss and bruising that reduces quality. The abattoir will be a 25 head per shift abattoir (~ 550 per month). It would be practical to situate the beef abattoir adjacent to the chicken abattoir that has considerable freezer capacity that could be shared.
Beef processing and packaging
The beef processing facility that will be used as the bulk beef processing and portioning facility will be attached to the abattoir with its own freezer units. This facility consists of Stainless Steel worktables, meat saws, portioning and packaging equipment and receives carcasses from the abattoir portions, processes and packages the meat into the different cuts. Expensive cuts are sold to up market stores, restaurants and butcheries. The more affordable cuts and tertiary products are sold to the Frozen Meat Depots.
Wholesale distributors
Dressed carcasses are purchased from abattoirs and processed (cut up) for fast food outlets, restaurants and retail and domestic consumers. In the rural areas the main demand is for the cheaper fore quarter cuts (Neck, shin brisket etc. and tertiary products) while the urban areas demand the more expensive hindquarter cuts (Rump, fillet etc.). Generally cutting up costs are R2.50 – R3.00 per kg. A whole carcass, cut into family cooking portions, roasts, steaks, chops, stewing, mince, wors, soup, dogs bones etc. can be purchased for R19.00 per kg.
Retail distributors (Butchers, Restaurants, hotels, caterers and lodges, stores, and fast food outlets) further add value by cooking and preparing meals for consumers. In the rural areas the demand is for a low cost tasty meal. “Pap en vlies” and the “buy ‘n braai” concept are very popular.
The cattle hide Industry is a spin-off of the beef industry
The hide market in S.A. is dictated by the export market demand for tanned leather. 90% of S.A.’s leather is exported to Italy where it is processed further and cut into very thin slices for use in high value clothing, furniture and motor car seats. A cowhide can be cut into 4 – 5 slices. This value-added leather is then imported back into S.A. for use in our furniture clothing and car manufacturing industry. The reason why this is not done locally is due to economies of scale and the capital cost of the equipment needed to slice and process the skins. The main tanneries in the country are to be found in Port Elizabeth, Brits and Silverton. Area agents in the rural areas go around and buy wet “green” skins or wet “salted” skins from small abattoirs and farmers. Every week a Regional agent collects these skins by truck and finds the best price from the tannery for the Area agent. The tannery tans the skin and bulk packs for export to Italy.
Current prices FOB abattoirs are;
3) Green skins sell for R12.00 – R14.00 per kg collected or approximately R360.00 – R420.00 per 30 kg skin.
4) Salted skins sell for R14.00 – R16.00 per kg collected or approximately R420.00 – R480.00 per 30 kg skin.
Average skin weight for a feedlot fed animal is 30 kg’s per skin. Prices vary up and down by approximately 10% during the year. Because 90% of hides are exported, the price is Rand US$ dependant. Tanneries sell various different grades of unsliced leather to local manufactures of leather goods – veldskoens, belts, hats, saddles, harnesses, collars, key rings, balls etc. Many of these products can be hand made in small one-man businesses (SMME’s) and could provide many SMME and work opportunities.
Other Primary Industries
Dairy Farming
As climatic conditions in the Province are not very conducive with regard to dairy production, more than 90% of the total consumption is imported from neighbouring provinces. Due to high input costs gross margins and sustainability are very sensitive. However, processing and distribution operations are well established and it could still be maintained that market opportunities does exist especially with small and emerging farmers in mind.
Goat Farming
The impact of Goat farming in the Province is relatively insignificant. However, goats are well adapted to inherent climatic conditions and should lend it to future development opportunities. Goats are very popular among Black rural people and should fit in very well in rotational farming systems in the traditional Bushveld areas of the Limpopo Province. If slaughtered at a young age, Goat meat is very tender and succulent and therefore the preferred meat type for Black consumers.
SUMMARY OF MARKET OPPORTUNITIES
Broiler Industry
It is estimated that about 80% of the formal market in the Limpopo Province is supplied by local broiler producers and abattoirs. The balance of the formal market is supplied by national suppliers that source their supplies outside the Province. Supply from outside the region therefore accounts for an estimated 20% of the total demand for processed chicken products.
The total market in the Limpopo Province is estimated at 600 000 (Avg dressed mass 1.5 to 1.75kg) broilers per week of which the formal sector accounts for an estimated 500 000 units per week. The balance of ± 100 000 units per week is traded in the informal sector and sold mainly as live chicken. The latter sales are often over the fence, at road stalls or through direct contact between supplier and consumer. The formal trade in the Limpopo Province follows a similar pattern to the national distribution and supply structure presented in Figure 3.1. It is estimated that about 25% of the trade is done through the retail groups, including the major retail chains and convenient stores. A further 45% goes through wholesale groups and independent wholesalers who service the smaller food stores, cafes, spazas and independent retail outlets. The institutional market is estimated to account for approximately 7% of the total market and the food services market making up the balance of 5%. In summary the estimated market demand is presented in Table 4.1.
TABLE 4.1
DISTRIBUTION OF CHICKEN PRODUCT BY OUTLET
- Whole Broiler Equivalents per Week –
|Segment |Distribution Channel |Broilers/week |% of Total |
|Formal – Processed chicken |Retail Chains |125 000 |20 |
| |Convenience stores |35 000 |5 |
| |Wholesale groups |50 000 |10 |
| |Independent wholesalers1) |150 000 |36 |
| |Institutional/large users |25 000 |7 |
| |Food service markets |30 000 |5 |
| |Sub-total |500 000 |83 |
|Informal – live chicken |Live direct to consumer |100 000 |17 |
|TOAL |- |600 000 |100 |
Note: 1) Includes direct sales by Producers to the retail market
Broiler producers in the Limpopo Province, being smaller operators and serving the regional market, tend to do more direct selling than their counterparts in other markets in South Africa. In this sense they operate as Independent Wholesalers. A sizeable percentage of their output is marketed and distributed directly to smaller retail outlets, cafes, spazas, restaurants, catering businesses and to the institutional market. It is believed that the IBP should follow a similar route distributing directly to smaller outlets in the province but also acting as a wholesaler/retailer that would sell tertiary products as well as fresh and frozen primary products from its abattoir.
From this breakdown the following are important considerations for the IBP.
i) Independent Wholesalers, which normally operate cold storage facilities in major towns, represent a major market outlet for chicken producers. These in turn supply both the formal and informal trade and may even supply smaller outlets belonging to retail chains. Examples of such Independent Wholesalers include Geosame Meat Market, Seaworld, etc.
ii) The informal market represents a major market segment. The direct sale of live chicken by broiler producers should therefore be considered seriously as an outlet for the IBP. It is reported that live chicken often fetch higher prices than slaughtered product, this making this as attractive marketing channel.
iii) The abattoir is ideally situated to provide a direct outlet of processed chicken product to the public, small retailers and the informal sector. As such the abattoir could fulfil the role of an Independent Wholesaler, thus shortening the distribution channel and increasing net prices. It is therefore recommended that a wholesale activity be situated at the site and the direct sales to the public, institutional buyers, smaller retailers and similar outlets be considered.
iv) The food services market, although small, represents a growing market. Suppliers and buyers within this market, however, indicated that this is a market with high specifications and fairly tight prices. It is believed that a newcomer will find it difficult entering this market as buying is normally done centralised from well-known and reputable suppliers.
v) Institutional users include prisons, defence force, hospitals, schools and other parastatals as well as large independent buyers such as mining groups, etc. The overall demand by this sector is estimated to about 7% of the market in Limpopo Province.
5 Conclusions
i) The current broiler market can at best be described as very difficult. The industry is plagued by high input costs, static demand and prices that are not reflecting increasing cost structures. The industry is known to be cyclical and is currently possibly at its lowest ebb. Various suppliers and distributors indicated that the situation should improve from the middle of the year onwards.
ii) In terms of both broiler production and abattoir capacity, the proposed IBP is relatively small, accounting for less than 10% of the immediate market in the Limpopo province. In marketing terms it is generally accepted that a 10% market share could be obtained if a good quality product at market prices is delivered. The market in the Limpopo province is estimated at approximately 600 000 broiler equivalents per week. In addition other markets e.g. Mpumalanga and Gauteng should be considered as secondary potential target areas for the IBP.
iii) Whilst the market for whole birds and especially frozen products is considered to be fully saturated, market opportunities exist in value added products such as pre-packed, marinated portions, crumbed portions, etc. Distributors in the region expressed an interest to market such products on behalf of IBP. Value added product and fresh chicken generally fetch prices considerably higher than that for the commodity product (frozen chicken).
iv) The traditional marketing and distribution channels seemed to be fully catered for by the major national suppliers. This includes the retail chains, traditional wholesalers and convenient stores. Better marketing and distribution opportunities exist in:
▪ Distribution to independent wholesalers
▪ Direct supply to large end-users, small retailers and the informal sector
▪ Supply of live chicken
▪ Ex-factory sale directly to various segments of the market.
BEEF INDUSTRY
Markets and marketing
Although the Limpopo Province is not agriculturally rich, it has abundant resources and the potential to produce a significant proportion of its own feed and food products. However, at present most of the feed and food products are imported into the province. There is a significant market and opportunity in the province for locally produced feeds and food and thus for branded Frozen Meat Depot’s and Frozen Meat Shop’s that target lower income consumers. The establishment of 8 new platinum mines will significantly increase the spending power of consumers in the region and create a multiplier effect in the region. Chicken and beef meat are products purchased by the state (hospitals, prisons, defense forces and schools) and the proposed BU’s will benefit from the “Captive Market” created by the government preferential tender procedure for Black Economic Empowerment firms. The integration process itself creates contractual captive markets for Business Units that are part of the “Value Chain”. The mark-up on bulk and retail fast food meat is generally high and there is scope for integrated firms that share profit at different sites, to successfully compete with value, quality, service and price.
One of the fundamental aims of the proposed Integration Strategy is to facilitate the marketing of primary and processed products. The Depots and the Shops need frozen meat, which is supplied by the chicken, and beef abattoirs, which is supplied by the broilers, and feedlot, which is supplied by the chick breeders and hatchery and cattle farms. The feedlot breeders and broilers also need feed, which is supplied by the Feed Mill, which is supplied by the crop farmers. These Business Units are linked by a market contract to supply a specific quality at a specific price on a specific date. The Depts. and Shops are the outlet to final users the consumers and thus they are the main driving force that pulls the products through the processing and productions phases. They are, however, not the only outlets. Once a BU has met their contractual obligation they can sell to anyone and if the supplier does not meet the specifications, quantities and timings of the purchaser they may purchase from anyone. As good quality meat is specified a “Value Chain” is created that demands good quality at every BU and operational level. A major advantage of this strategy is that it provides the production and processing operations with a captive market for most if not all their product.
The Pig Industry
The main objective should be to reactivate existing capacity in the Province in order to retain the strategic advantage of integration.
SCOPING LEVEL COSTS
Gross Margins per primary activity
References:
1. Agriman Report: Interpreted Meat Production (2002)
2. LHA Management Consultants: Market Assessment for Broiler Production in Limpopo Province (May 2002)
3. Glen Steyn: Animal Feed Production on the Limpopo Province
4. Marius Pretorius: Northern Province Meat Sub-sector Analysis (2001)
5. Statssa: Reports (2002 – 2004)
6. NDA: Agricultural Statistics (2002 – 2004)
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