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The Farming of Animals in South Africa

Farming of Animals In South Africa 2020

Rebecca Viljoen | South Africa | 11 December 2020

Farming of Animals In South Africa 2019

Marc Bosman | South Africa | 14 March 2019

Farming of Animals In South Africa 2017

Marc Bosman | South Africa | 09 May 2017

Farming of Animals In South Africa 2015

Brenda Young | South Africa | 30 January 2015

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Report Coverage

This report focuses on the farming of animals in South Africa, with a particular focus on the production of livestock. It includes information on the state and size of the sector and focuses on various subsectors, including stud and stock breeding, commercial livestock farming, an emerging commercial sector, communal farmers, speculators and horse and game breeders. There is information on cattle, dairy, pig, sheep, goat and game farming and statistics on consumption, imports and exports, slaughters per province, land use and number of households involved in agriculture, among others, and information on factors that influence the sector such as disease, theft and environmental and land issues. This report does not include profiles of notable industry players.

Introduction

This report focuses on the farming of animals in South Africa, with a particular focus on the production of livestock. Livestock farming is South Africa’s largest agricultural sector, accounting for over 40% of agricultural output’s total value and occupying roughly 80% of available agricultural land. In 2019, agriculture contributed an estimated R81.34bn to GDP. Animal products contribute 44.2% to the total gross value of agricultural production, with red meat accounting for 17.2% of animal products’ contribution. In the year to end-June 2020, the gross production value of animal products increased by 3.7% to R127.89bn. In South Africa’s rural areas, animal husbandry is often the primary income generator. To many South Africans, livestock is also a form of social capital. Although primary agriculture contributes a relatively small share to the country’s GDP, it plays an important role in job creation and earning foreign exchange through exports. The strength of South Africa’s livestock production lies in its well-established private sector, and its support for small and emerging commercial farmers. Many animal farmers have a wealth of institutional knowledge; operating farms that have been in the family for generations. While South Africa faces ongoing disease outbreaks, it has a relatively effective animal health system for mitigating, tracking and responding to disease. The sector is responding to mounting pressure for high standards and transparency with regards to safety, quality, environmental sustainability and welfare. The ongoing drought in many regions of South Africa is severely affecting animal farmers.

Strengths

• Livestock production is appropriate for South Africa’s agricultural land.
• Many generations worth of institutional knowledge in the commercial and communal animal farming sectors.
• South Africa has a reputation for high quality meat.
• South Africa has relatively good animal health and safety regulations.
• South Africa is a net exporter of beef products.
• Strong representation of well-established industry organisations.
• Weak exchange rate benefit exports.

Weaknesses

• Animals’ high susceptibility to disease and illness.
• Feed intensive industry with reliance on favourable crop conditions for price and supply of feed.
• Inadequate enforcement of health and safety regulations and animal welfare legislation.
• Industry’s contribution to environmental degradation, resource depletion, and greenhouse gas emissions.
• Lack of data affects policy design.
• Lack of effective data management and use.
• Lack of substantial transformation in the industry with limited ongoing, effective support for the development of emerging farmers.
• Susceptibility to the adverse effects of climate change and variation.

Opportunities

• Better animal welfare practices can open global markets up to South African producers
• Biodiversity management on animal farms.
• Communal farmers to produce wool.
• Demand for free-range and antibiotic free meat and dairy.
• Diversifying farms to offer recreational activities and tourism.
• High international demand for game meat, notably ostrich meat and products.
• Importing high quality meat (livestock and game).
• Improved genetics that increase animal productivity and resilience.
• Marginal land can be used for game farming.
• New markets for heat-treated ostrich meat and leather.
• Pig farming.
• Public-private partnerships: established commercial farmers to guide support programmes, including capacity building, for emerging farmers.
• Sustainable livestock farming.
• Untapped farming reserves on communal land.

Threats

• Disease and drought.
• Fear of diseases such as bird flu prevent people from eating ostrich.
• High levels of production debt caused by prolonged periods of drought
• Income fluctuation and declining consumer disposable income causing reduced meat consumption.
• Lack of or restricted access to land and water.
• Loss of scarcity of game stock.
• Non-compliance to domestic and international standards.
• Overgrazing.
• Predation and livestock theft.
• Rising input and labour costs.
• Slowing growth rate of meat and dairy products demand.
• The negative effects of climate change on livestock production and grazing land.

Outlook

In the face of climate change’s impact on livestock production, farmers will need to improve their adaptive capacity. There is also a mounting pressure from consumers for livestock production to become more transparent, ethical and environmentally-friendly. The negative effects of climate change and the rising global demand for protein-rich diets may cause sustainability challenges for livestock production. It is anticipated that additional supply of meat will come from developing regions. The growth in demand for animal products is slowing. The Food and Agriculture Organization of the United Nations (FAO) expects South African meat consumption to increase by 12% over the next decade compared to 25% growth over the last decade. The projected annual growth for beef production over the next decade is 1.3%. Since many developed countries have reached saturation in terms of levels of meat consumption, there may be opportunities to export high quality meat. In the short-term, economic recession has reduced global spending power. The economic fallout set off by the coronavirus pandemic is expected to decrease the consumption of animal products and there will likely be low consumption growth rates over the next decade. Milk continues to be an affordable protein source. Despite being susceptible to shocks related to disease, including export bans, and exchange rates, the South African wool market is fairly stable with strong demand from Europe. Over the next ten years, wool production is expected to increase at a lower rate than the previous decade due to predation and livestock theft, amongst other challenges. The industry faces ongoing challenges with rising input costs, drought, disease, livestock theft, predation, policy uncertainty and property rights.

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Farming of Animals In South Africa 2020

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Farming of Animals In South Africa 2019-03-14

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Farming of Animals In South Africa 2017-05-09

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Table of Contents

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PAGE
1. INTRODUCTION 1
2. DESCRIPTION OF THE INDUSTRY 1
2.1. Industry Value Chain 6
2.2. Geographic Position 7
3. SIZE OF THE INDUSTRY 10
4. STATE OF THE INDUSTRY 16
4.1. Local 16
4.1.1. Corporate Actions 20
4.1.2. Regulations 20
4.1.3. Enterprise Development and Social Economic Development 22
4.2. Continental 23
4.3. International 26
5. INFLUENCING FACTORS 29
5.1. Coronavirus 29
5.2. Economic Environment 30
5.3. Government Incentives and Support 31
5.4. Drought and Wildfire 31
5.5. Disease 32
5.6. Livestock Theft, Crime and Predators 33
5.7. Land 34
5.8. Input Costs 35
5.9. Research and Development (R&D), Technology and Innovation 36
5.10. Environmental, Health and Animal Welfare Concerns 37
5.11. Cyclicality 40
5.12. Labour 41
6. COMPETITION 43
6.1. Barriers to Entry 44
7. SWOT ANALYSIS 44
8. OUTLOOK 46
9. INDUSTRY ASSOCIATIONS 47
10. REFERENCES 49
10.1. Publications 49
10.2. Websites 50

Introduction

This report focuses on the farming of animals in South Africa, specifically the extensive or pastoral production of livestock. Livestock farming is the largest agricultural sector and continues to suffer the consequences of reduced rainfall since 2014, ongoing drought and drought-induced losses, excessive temperatures which affect breeding, rising input costs, increasing crime, stock theft and predation, diseases, reduced consumer spending and limited access to land, water and resources. The sector continues to decline in terms of number of farmers and livestock, with the national beef herd down by over 700,000 and more than 1 million sheep lost. Despite all this however, gross animal product income for 2017/2018 of R142.97bn was 13.3% higher than the R126.16bn reported in 2016/2017, which can largely be ascribed to better prices received by farmers. The industry is largely severely financially constrained and remains challenged by policy uncertainty on the land expropriation issue.

Strengths

• Strong focus on research and development and animal health and safety.
• The Industrial Policy Action Plan, New Growth Path and the National Development Plan identify agriculture as a sector with significant potential for economic growth and employment generation.
• Well represented by a wide spectrum of industry organisations.

Weaknesses

• Enforcement of health and safety regulations, as well as animal welfare legislation is inadequate.
• The sector is one of the primary contributors of greenhouse gas emissions.
• There has been relatively little transformation in the industry and ongoing support for the development of emerging farmers is limited.

Opportunities

• Development of the organic food sector identified in the Department of Trade and Industry – Industrial Policy Action Plan IPAP2.
• Increasing consumer demand for grass-fed beef, and true free-range pork, mutton and lamb.
• Increasing red meat demand and consumption on rising urbanisation and growing emerging middle-class.

Threats

• Climate change and unpredictable climatic conditions.
• Declining consumer disposable income causing reduced meat consumption.
• Escalating input and labour costs.
• Increased land-grab incidents, crime, stock theft and predation.
• Increasing outbreaks of livestock diseases.
• Lack of or restricted access to land and water.

Outlook

Agricultural economist Frikkie Maré of Free State University forecasts 2019 will be a difficult year for livestock producers. This is due to numerous variable influencing factors, reduced maize plantings, possible smaller harvest volume, feed quality issues, poor pasture and grazing, reduced consumer spending on red meat and disease impacts on exports due to climate variability. Farmers will remain under margin pressure and continued farm failures appear to be unavoidable. Local beef production is expected to increase by 14% over the period to 2026 as a result of increasing urbanisation and the growth of the black middle class. However, Agbiz reports that industry bodies and stakeholders remain deeply concerned over policy uncertainty and apparent government attempts to erode individual property rights, for this will have a direct impact on investment into the sector and subsequently food security.

Farming of Animals In South Africa 2019

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R 1 900.00(ZAR) estimated $100.23 (USD)*

Industry Landscape

R 1 330.00(ZAR) estimated $ 70.16 (USD)*

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Farming of Animals In South Africa 2020-12-11

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Farming of Animals In South Africa 2017-05-09

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Farming of Animals In South Africa 2015-01-30

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Table of Contents

[ Close ]
PAGE
1. INTRODUCTION 1
2. DESCRIPTION OF THE INDUSTRY 1
2.1. Geographic Position 3
2.2. Industry Value Chain 4
3. SIZE OF THE INDUSTRY 5
4. STATE OF THE INDUSTRY 15
4.1. Local 15
4.1.1. Corporate Actions 18
4.1.2. Regulations 18
4.1.3. Enterprise Development and Social Economic Development 22
4.2. Continental 24
4.3. International 27
5. INFLUENCING FACTORS 29
5.1. Government Initiatives and Intervention 29
5.2. Land Issues 33
5.3. Consumer Demand, Consumer Health and Retailer Needs 35
5.4. Grazing Capacity and Stocking Rate 35
5.5. Animal Disease 36
5.6. Economic Environment 37
5.7. Rising Input and Operating Costs 39
5.8. Agricultural Commodity Market Impact 40
5.9. Technology, Research and Development (R&D) and Innovation 41
5.10. Labour 43
5.11. Cyclicality 46
5.12. Environmental Concerns 47
5.13. Crime, Stock Theft and Predation 49
6. COMPETITION 51
6.1. Barriers to Entry 52
7. SWOT ANALYSIS 53
8. OUTLOOK 53
9. INDUSTRY ASSOCIATIONS 54
10. REFERENCES 56
10.1. Publications 56
10.2. Websites 59
APPENDIX 1 61
Definition of Free-Range Farming 61

Report Coverage

The Farming of Animals in South Africa describes current conditions, Enterprise Development and Social Economic Development initiatives as well as legislative developments. Factors that influence the success of the sector are also included in this informative report.

Introduction

This report focuses on the farming of animals in South Africa. Livestock farming is the largest agricultural sector with a population of 13.399 million cattle and 23.287 million sheep as at August 2016. These numbers are significantly down from the 13.695 million cattle and 23.938 million sheep in 2015 due to the poor 2014/2015 rainfall season, the drought-induced losses of 2016 as well as stock theft and predation. According to the Department of Agriculture, Forestry and Fisheries (DAFF) 2016 Abstract of Agricultural statistics, 2015 revenue from animal products, excluding fowls slaughtered and eggs, amounted to R63.178bn, an increase of over 15% on the 2014 figure of R54.667bn. The livestock industry is expected to grow as global population growth and the expansion of developing economies boost the demand for meat. However, the industry remains racially polarised and extremely politicised in terms of access to land and water.

Strengths

• Strong focus on research and development and animal health and safety.
• The Industrial Policy Action Plan, New Growth Path and the National Development Plan identify agriculture as a sector with significant potential for economic growth and employment generation.
• Well represented by a wide spectrum of industry organisations.

Weaknesses

• Enforcement of health and safety regulations, as well as animal welfare legislation is inadequate.
• The sector is one of the primary contributors of GHG emissions.
• There has been relatively little transformation in the industry and ongoing support for the development of emerging farmers is limited.

Opportunities

• Development of the organic food sector identified in IPAP2.
• Increasing consumer demand for grass-fed beef, and true free-range pork, mutton and lamb.
• Increasing red meat demand and consumption on rising urbanisation and growing emerging middle-class.

Threats

• Climate change and unpredictable climatic conditions.
• Declining consumer disposable income causing reduced meat consumption.
• Escalating input and labour costs.
• Increased land-grab incidents, crime, stock theft and predation.
• Increasing outbreaks of livestock diseases.
• Lack of or restricted access to land and water.

Outlook

Current local beef and sheep prices seem set to increase and remain high due to the reduced availability of livestock. FNB reports the improved feed outlook points to better long-term profitability for livestock farmers with beef prices supported by the reduced supply of Australian and New Zealand beef. Local beef production is expected to increase by 14% to 2026 as a result of increasing urbanisation and the growth of the Black middle class. However, Agbiz reports that industry bodies and stakeholders remain deeply concerned over policy uncertainty and apparent government attempts to erode individual property rights as this will have a direct impact on investment into the sector and subsequently food security.

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Farming of Animals In South Africa 2017

Full Report

R 1 900.00(ZAR) estimated $100.23 (USD)*

Industry Landscape

R 1 330.00(ZAR) estimated $ 70.16 (USD)*

Historical Reports

Farming of Animals In South Africa 2020-12-11

R 1 900.00(ZAR) estimated $100.23 (USD)*

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Farming of Animals In South Africa 2019-03-14

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Farming of Animals In South Africa 2015-01-30

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Table of Contents

[ Close ]
PAGE
1. INTRODUCTION 1
2. DESCRIPTION OF THE INDUSTRY 1
2.1. Industry Value Chain 3
2.2. Geographic Position 4
3. SIZE OF THE INDUSTRY 4
4. STATE OF THE INDUSTRY 12
4.1. Local 12
4.1.1. Corporate Actions 14
4.1.2. Regulations 14
4.1.3. Enterprise Development and Social Economic Development 17
4.2. Continental 20
4.3. International 21
5. INFLUENCING FACTORS 24
5.1. Government Initiatives and Intervention 24
5.2. Land Issues 27
5.3. Consumer Demand, Consumer Health and Retailer Needs 29
5.4. Grazing Capacity and Stocking Rate 29
5.5. Animal Disease 29
5.6. Economic Environment 31
5.7. Rising Input and Operating Costs 32
5.8. Agricultural Commodity Market Impact 32
5.9. Technology, Research and Development (R&D) and Innovation 33
5.10. Labour 35
5.11. Cyclicality 38
5.12. Environmental Concerns 38
5.13. Crime, Stock Theft and Predation 39
6. COMPETITION 41
6.1. Barriers to Entry 41
7. SWOT ANALYSIS 42
8. OUTLOOK 43
9. INDUSTRY ASSOCIATIONS 43
10. REFERENCES 45
10.1. Publications 45
10.2. Websites 51
APPENDIX 1 53
Free-Range Farming 53

Report Coverage

The Farming of Animals report describes current conditions, factors that influence the success of the sector and prospects for an industry that is expected to grow as global population growth and the expansion of developing economies boost the demand for meat. Statistics for all domestic farm animals are provided, including for the ostrich industry where 588 registered farms and ten EU-approved and registered export abattoirs export meat and products to the value of approximately R1.2bn annually.

Introduction

This report focuses on the farming of animals in South Africa. Livestock farming is the largest agricultural sector in the country with a population of some 13.9 million cattle and 24 million sheep. Approximately 80% of the country’s agricultural land is suitable for extensive livestock farming. According to the Department of Agriculture, Forestry and Fisheries (DAFF), in 2013 revenue from animal products increased by 7.4% from 2012 and amounted to R87.437bn. The industry is expected to grow as global population growth and the expansion of developing economies boost the demand for meat. Of concern to those involved in the industry are outbreaks of Foot-and-Mouth (FMD) disease and the occurrence of bird flu in the ostrich population. In February 2014, after a three-year ban on the export of red meat, South Africa was recognised by the World Organisation for Animal Health (OIE) as a country with a zone free of FMD without vaccination. However, exports are under threat again after an OIE mission team conducted a verification assessment on FMD controls in December 2014 and identified areas that need further attention.

Strengths

• Organised industry with associations for all livestock producers.
• Strong fundamentals are available: land, water and technical support.
• There is traditionally a large commercial sector where capital investment continues.

Weaknesses

• Emerging commercial farmers lack funding and technical expertise.
• Emerging farmers have limited access to market infrastructure such as abattoirs to reach final markets.
• Lack of protection from global players who are able to export cheaper meat because of the subsidies and incentives they receive.
• Susceptibility to disease and stock theft is intensified because regulations are not always enforced.
• The ostrich industry is a high risk one as it takes 30 months before money can be obtained from the business
• The presence of predators.

Opportunities

• Empowerment initiatives which are supported by the government.
• Farming of angora goats because there is a high global demand.
• Increased exports of heat-treated ostrich meat to Europe.
• Increasing exports of beef due to South Africa gaining its free FMD status, provided OIE control measures are implemented in the FMD free zone.

Threats

• Increase in the spread of animal diseases if regulations continue to be flouted.
• Increasing imports of cheaper meat as local farmers cannot compete with countries where production is subsidised.
• Introduction of more stringent environmental regulations which will add to the continuing increases in production costs.
• Land reform policy, if uncoordinated and if emerging farmers are not given support and training.
• South Africa meat exports under threat from the country losing its FMD free status.

Outlook

The Red Meat Producers' Organisation said more South Africans are buying red meat and demand will rise in the region of 20% in the next six or seven years. This provides a generally positive outlook for the industry. However, animal health in all sub-sectors remains a challenge. The lifting of the export ban on red meat due to FMD is a relief to producers and exports have started to increase but are under threat again unless adherence to OIE guidelines, as determined from the December 2014 OIE team visit, is met. The goat meat industry is in its infancy but there is growing interest in the farming of goats because the meat is lean and high in iron and vitamin B12. Stakeholders believe the game industry, especially the rare game sector, will continue to grow over the next few years.

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Farming of Animals In South Africa 2015

Full Report

R 1 900.00(ZAR) estimated $100.23 (USD)*

Industry Landscape

R 1 330.00(ZAR) estimated $ 70.16 (USD)*

Historical Reports

Farming of Animals In South Africa 2020-12-11

R 1 900.00(ZAR) estimated $100.23 (USD)*

View Report Add to Cart

Farming of Animals In South Africa 2019-03-14

R 1 900.00(ZAR) estimated $100.23 (USD)*

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Farming of Animals In South Africa 2017-05-09

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Table of Contents

[ Close ]
PAGE
1. INTRODUCTION 1
2. DESCRIPTION OF THE INDUSTRY 1
2.1. Industry Supply Chain 2
2.2. Geographic Position 3
3. SIZE OF THE INDUSTRY 4
4. STATE OF THE INDUSTRY 10
4.1. Local 10
4.1.1. Corporate Actions 12
4.1.2. Regulations & Government Programmes 12
4.1.3. Enterprise Development and Social Economic Development 14
4.2. Continental 14
4.3. International 16
5. INFLUENCING FACTORS 17
5.1. Economic Environment 17
5.2. Rising Input Costs 17
5.3. Consumer Demand 18
5.4. Animal Disease 19
5.5. Stock Theft and Damage Causing Animals (DCA) 19
5.6. Labour 20
5.7. Land Reform Policy 22
5.8. Government and Commercial Farmer Support for Emerging Farmers 22
5.9. Technology and Information Technology 23
5.10. Environmental Concerns 24
6. COMPETITION 25
6.1. Barriers to Entry 25
6.2. Research and Development (R&D) and Innovation 26
7. SWOT ANALYSIS 27
8. OUTLOOK 27
9. INDUSTRY ASSOCIATIONS 28
10. REFERENCES 29
10.1. Publications 29
10.2. Websites 30