Norwegian quota accounts for 23% of total exports
The highly lucrative but small Norwegian quota accounts for at least 23% of the total revenue received from Meatco’s export markets according to Mario Poolman, Manager: Communication and Marketing. By volume, the quota accounts for only 8% of Meatco’s total exports and is the lowest while exports to South Africa are close to 40%. 30% of Meatco’s total production is kept in Namibia with close to 17% earmarked for the European Union.
Exports to South Africa, despite the huge volumes, account for only 27% of total revenue exporting.
Said Poolman, “If you sell to Meatco, we do not put your cattle aside and sell whole carcasses to specific markets.
As soon as an animal is slaughtered, the carcass is de-constructed, the meat sorted into various cuts like the rump, sirlion or shin for example. Certain markets demand more of a specific product, and we move products around different markets to extract the maximum value.”
He added that Meatco tries to put as much high-value cuts as possible into countries willing to pay premium prices for those cuts.
“When buying animals for slaughter, price and quality are interrelated. Good quality animals yield good quality cuts and higher prices in the market and therefore higher prices for the farmer. I must add that we are a price maker in the local cattle market.
We aim to pay the highest possible price in the market and our competitors have to follow suite,” said Poolman.
He explained that all the profits realised are split in equal proportion amongst producers, arguing that Meatco does not work for a profit but for producer prices. “We are a not for profit mechanism. We want to stimulate cattle production in the country and that requires that we focus on paying the highest prices rather than making the biggest profits,” he added.
Said Poolman, “The Namibian government has delegated the Meat Board of Namibia to ensure a fair distribution of the Norwegian quota. The Meat Board determines how much each exporter will receive of the Norwegian quota.”
Meatco recently revised a decision to lay off workers following a decision taken in July 2013. Meatco cited a decline in cattle numbers as a pivotal factor. An uptake in cattle numbers however has sparked a production frenzy at its Okahandja and Windhoek factories and at least 16,000 cattle are expected to be slaughtered over a five-month period. The surge in activity was bolstered by the Norway quota, and a decline in the exchange rate of the Namibia dollar. Earlier, Meatco had announced that it was granted a 400 ton allocation in addition to what was originally allocated for the Norwegian quota.