Beef Sector Eyes Growth Of Its Export Footprint

20 April 2021 – The South African beef industry stood a good chance to capture a slice of the global export market if it competed with markets that exported lower volumes of better-quality beef, said the Beefmaster Group.

Roelie van Reenen, the supply chain executive, said last week that those were countries like the Netherlands.

The supplier of beef products to South Africa, the Middle East and Far East, among other countries, said that while most of the global beef supply growth was from Brazil and Argentina, those markets were exporters of lower-value bulk beef products, and should not be compared to South Africa.

“South American beef players all compete in a very tough pricing market due to their huge scale. In contrast, South African beef has gained a reputation the world over for its premium quality. This is because our classification system makes our product unique in the world,” said Van Reenen.

He said the cattle South Africa used for meat production was not as mature as those in the bulk export markets, which gave South African beef an advantage of a leaner taste, with less fat, making it much sought after.

“It has a pink tone in colour, almost like rosé veal, but it is not quite veal and it is not quite US beef. It is in between,” he said, adding that local beef was loved in select markets like the Middle East and Far East.

Van Reenen said South Africa, together with some of its neighbours like Namibia and Botswana, were in a “herd-rebuilding phase” following an extended drought.

“Cattle production figures are down across sub-Saharan Africa, but we are well on our way to make a recovery and build our herds. Following good rains, South Africa is on track to rebuild our national herds by 2022. It remains to be seen whether South Africa can both build capacity and increase the supply of quality beef,” said Van Reenen.

The biggest barrier was access to more markets. Van Reenen said that would depend on how well and how quickly, the government and industry players worked together to create opportunities on the global stage for South African beef to shine and carve its own market.

“We need government players to mobilise and open new markets for the South African beef industry. This can be achieved only if political intentions are set aside to create economic opportunities that will, at the end of the day, benefit every farmer in the country, that is, both subsistence and commercial farmers.”

Van Reneen said South Africa had shown its mettle in creating opportunities for the local beef industry, referencing several trade agreements that were signed in recent years, allowing South Africa to export its beef to markets to markets like Mauritius, the United Arab Emirates and Egypt. He said those were good examples of what could happen when the public and private sector partnered.

“The fact that we can export creates economic opportunities for all players in the beef supply chain, including our competitors. If there is less of our product in the local market, it creates more demand for others. Exporting also allows farmers and other players to fetch better prices, because there is more demand.

“At the end of the day, more opportunities to export quality beef products creates an industry advantage. But everyone in the value chain has to play their part to ensure that we continue to deliver quality beef both locally and globally,” he said.

According to the Beef Market Value Profile of 2019, created by the Department of Agriculture, Forestry and Fisheries, the beef industry is the second-fastest growing commodity in the agricultural sector, after the broiler sector. It is driven by income growth, technological support and structural change.

The gross value of beef production increased from R13.6 billion in 2008/09 to R37bn in 2017/18. This represented a 173 percent hike during the said period due to the increased consumption of beef over the past decade. The average gross value of beef produced during this period amounted to R23.5bn per annum. Source (Business Report)