Animal feed is a starting point for more crop production
The N$700 million investment by Namib Mills in its new chicken farm, holds many downstream benefits for agriculture in general and for agronomy in particular.
Attending the auspicious inauguration early this week, I could not help but be impressed by the scale of this broiler production facility. True, it is not the first attempt at broiler production, but it is the first at this scale.
When, at a rather late stage of planning and implementation, a dispute arose over the sale of the land on which the chicken farm is situated, it was resolved by pointing out that on this 3000 ha farm, the protein equivalent of about 60,000 cattle will be produced every year. And that at about half the cost for red meat.
But it was not so much the breakdown of the project estimates that caught my attention. The people behind this investment are experts in projects of this type. I am sure their projections are as spot-on as is practically possible. What got my mind turning are the new opportunities created by one single broiler farm.
It is their intention to produce 50,000 chickens of 1.8kg per week. The extrapolated 60,000 heads of cattle at 390kg each, comes from this baseline figure. To ensure sustainable production it requires a dependable source of water, electricity, and above all, chicken feed. The facility, preferably, has to be located close to a tar road for logistical reasons and for maintaining the cold chain for product quality, which is essential. All these variables form part of the mix that determines the eventual success of the undertaking. Retailing aspects like branding, shelf space and stock, determine the rest. This part is not uncomplicated since one of the conditions for the Ministry of Trade and Industry to grant Infant Industry Protection of 46% for a stipulated period, depends on the producer’s ability to cover at least 70% of the country-wide market.
Since this operation requires such vast amounts of chicken feed, it creates synergetic opportunities for other suppliers in the group, but it also creates similar opportunities for local crop producers. And this is where an anchor investment of this scale becomes crucial to further developments in agriculture.
In the past, there was very little agronomic incentives to produce animal fodder. On every farm where rainfall is sufficient, animal fodder is only produced as a by-product of agronomy that targets human consumption. Be it white maize, sorghum or wheat, all production went into the local food processing industry. There was no economy of scale benefit when it came to animal feeds and every farmer produces only for him or herself. Now there is this behemoth of a production facility where hundreds of thousands of tonnes of raw material will be required to feed the hundreds of thousands of chickens. Immediately this opens the door and create the right incentives for agronomic production to expand and to attract investment.
At the recent Horticultural Day awards, it was noticeable how agronomic production has grown in importance, slowly but very determinedly. And with all these producers, the focus was only on food for human consumption. With animal fodder, although it still has to conform to certain standards, the potential for more acreage, especially on marginal land, and where water is limited, increases exponentially. In the end, if the produce is grown specifically for animal fodder, what does it matter if it is not perfect, or if the harvest yields less than expected. And once this process starts, it will quickly grow beyond the conventional harvesting of grass for cattle fodder, that one finds in the Grootfontein district. In my view, if a piece of land (dryland) is good enough to produce hay, then it is good enough to grow yellow maize or whatever crop that can be turned into chicken feed.
I also see an important nexus between the government’s initiative to erect grain silos in those areas where grain production, both dryland and irrigation, is indicated as a viable commercial undertaking.
Agriculture has the potential to empower thousands of households lifting them out of a subsistence farming environment into small scale commercial farming but then the infrastructure and the marketing channels must exist and must be sustainable. This in turn relies on supporting infrastructure i.e. roads, dams, silos, markets, as well as processing facilities where the basic agri commodities can be processed into the required product, in this case, animal fodder.
Another major benefit is that such an industry will force us to adopt the best water management practises available. It will also force us to find more water to be used in agronomy. Provided we can solve the water deficit in some way, agronomy with the specific aim to produce animal feeds, holds a big promise.