“I need 36 weeks to produce a lamb to the level where I can deliver it to an abattoir. For that lamb, which I’ve cared for over nine months, I’m currently getting about R88/kg. And then, within a week, that lamb’s price is jacked up so high in the rest of the value chain that it becomes unaffordable for the consumer. Somewhere, there’s a huge mistake.”
This is what Christoffel Lombard, a farmer from the Loeriesfontein area, said last week at a meeting with the Red Meat Producers’ Organisation (RPO).
Dr Frikkie Maré, CEO of the RPO, attended the meeting after the Loeriesfontein Farmers’ Union wrote to the RPO about its concerns.
The Loeriesfontein area has experienced severe drought conditions on and off since 2014, with poor rainfall recorded as recently as the summers of 2023 and 2024.
While some rain has fallen this winter, it has been inconsistent and some farms have received none. Farmers say the pressure the drought conditions have placed on them for over a decade will have long-lasting negative effects on their farms and businesses.
Economic pressure on consumers
Maré told the farmers that consumers are under tremendous pressure due to the weak economy and high interest rates. He said even he cannot afford lamb regularly, and consumers he has spoken to, including an anaesthetist and a doctor, said they mostly eat pork and chicken because lamb is too expensive.
“The current high interest rates are putting consumers under a lot of pressure,” said Maré. “It’s important to remember that the increase in mortgage and car payments reduces disposable income, even for those with very high incomes. The higher an individual’s income, the more expensive their house and car and the greater the impact of interest rate hikes.”
According to Lombard, over the past five years farmers have received R80/kg to R90/kg for lambs. “During the same period, the cost of feed pellets we get here has increased by 50%. Five years ago, the diesel price was about R12,90 – this year it reached R25. We won’t survive.”
Franchwa Batt, chairperson of the Loeriesfontein Farmers’ Union, showed African Farming’s sister title, Landbou.com, records of the prices they’ve been getting for their lambs since 2020. They mainly ranged from R80/kg to R90/kg, moving closer to R100/kg in some months and dropping as low as R74/kg in others.
Imports from Namibia
Farmers at the meeting said they are dissatisfied with how imports from Namibia are handled, as they often enter the country when their own animals are market-ready.
This is particularly problematic during March and April. Local producers’ lambs are market-ready then, but they try to balance slaughtering with income tax and VAT payments. They don’t want to slaughter in February because they want the income to be reflected in the next financial year, while they want to slaughter in March as VAT needs to be paid at the end of the month.
Abattoirs need a continuous flow of animals, and when few lambs arrive they source imports from Namibia. The imported lambs often arrive in March, coinciding with local lambs coming to market and causing bottlenecks. Abattoirs then have no slaughter space for local lambs and prices are pushed down due to the short-term oversupply.
Maré said the RPO is aware of the unhappiness about imports from Namibia, particularly among farmers in the Northern Cape and parts of the Western Cape.
“Although the imports put a lot of pressure on prices and access to abattoirs for farmers in these regions, historical data indicates that they don’t have a significant impact on national prices,” he said.
“When we want to argue for border closures, we must be able to prove to the government that imports are damaging our entire local economy, not just one region.”
Maré said that as recently as February the RPO held talks across the border to see if anything could be done to change the live import situation.
“However, due to national data from the past few years, we didn’t have a strong enough argument to succeed, especially when considering the overall trade balance between the two countries, which is very favourable for South Africa.
“It’s a delicate balance to try to maintain. If we close Namibia’s border to imports we cut the throats of the farmers there, and if we do nothing we cut the throats of our local farmers.”
Farmers also indicated that they have questions about abattoir prices and allegations of possible collusion.
