Livestock producer prices are killing the farmer

07 Jun, 2020 - 00:06 0 Views
Livestock producer prices are killing the farmer

The Sunday News

Mhlupheki Dube

SOMEONE please explain to me why beef producer prices are so depressed? Someone please kindly explain to me why everything else of significant value, even to not so significant value, is being paid for in hard currency yet livestock farmers have to contend with the local dollar.

I ask these depressing but very pertinent questions because the prevailing producer prices that are being offered to farmers are at best insulting and at worst provocative. I follow beef producer price bulletins every week and these are mostly for Cold Dressed Mass (CDM), which is to say carcass prices. I can say with certainty that at the moment most abattoirs are offering $130/kg for super and $85/kg for choice and commercial grades. When converted to street value of the US$, this translate to US$1,85/kg and US$1,21/kg respectively.

To put this into perspective especially for those who may not have had the opportunity to monitor beef producer prices trends, these are ordinarily live weight prices that are offered to farmers as CDM prices. In the past 10 or so years that I have been monitoring beef producer prices I can confirm that we have never hit this low. This time of the year choice and commercial grade would be going for around US$ 2,60/kg.

I recently attended a live cattle auction by a reputable commercial auctioneering company and the prices were pathetic, to describe them in polite terms. A 641kg clearly choice grade ox going for $30 000, which in street value is something around US$428. This means the animal was bought at around US$ $0,66/kg.

My expert view is that the actual value of that ox is around US$1 400. I know that someone is probably screaming that I am comparing bananas and oranges because we are in different circumstances due to Covid-19. My question is can we really blame it all on the Covid-19 or there is something else we are missing? Why is it that the poultry producer price has remained relatively stable, at least for the small-scale producers? I know for a fact that a broiler has been pegged at US$5 for some time now and it is still there. Why has cattle producer prices taken this slump? What is the future of this industry under such unviable price regimes? I know economists would want to be simplistic and jump to their default supply and demand rhetoric but I am not convinced this is sufficient to explain this carnage on livestock producers.

Such an erosion of value needs a more plausible explanation than a trivial dismissal through shallow economic pontification.

I am a livestock farmer and forgive me if I come through as angry because I know what goes into this industry in terms of investment. It takes at least two- and-a-half years to produce an animal which you can take to the market unless if you are selling weaners. Now that’s two-and-a-half years that go to waste basing on the prevailing prices.

The ox that I referred to above could have been four years old by my estimation and the farmer gets robbed of almost US$1 000 in value at the point of sale. I therefore, challenge farmers’ unions to stop this bloodletting before farmers are taken to the guillotine together with their animals.

Actually, if I had powers I could instruct livestock farmers to withhold their animals until respect for the producer is restored by the buyers.

This habit of buyers pretending as if farmers would not exist without them when in fact it’s the other way round, has to stop. We simply have to respect producers and give them decent prices for their sweat and blood or else we will kill the proverbial goose that has been laying golden eggs for us. The relationship between buyers and producers should be symbiotic where both parties derive mutual benefits not this parasitic status quo whose vampire attributes threatens to suck the blood dry from the livestock farmers.

Uyabonga umntakaMaKhumalo.

Feedback [email protected]/ cell 0772851275.

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