Presentation by Hikuepi Katjiuongua at an inception workshop for the Competitive Smallholder Livestock in Botswana project held at Gaborone, Botswana on 31 October 2012.

1. Competitiveness of smallholder
livestock: The case of Namibia
by
Hikuepi (Epi) Katjiuongua
Presented at an inception workshop for the Competitive Smallholder Livestock in Botswana project held at
Gaborone, Botswana on 31 October 2012
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2. Cattle/Beef Industry
 Importance of the livestock sector
 Over 60% of the population depend it for their livelihoods
 Number one source of employment in the country
 25% of foreign exchange earnings; worth: US$ 200 mil/yr.
 Namibian: dominant focus on export market
 Mixed success story:
 Among top ten foreign EU beef suppliers
 Smart marketing strategy: commodity to direct user
 But what is the role of smallholder producers in this story?
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3. Dual Farming Systems
 Commercial farmers
 About 4,200 farmers- control 52% grazing land
 Hold about 50% of national herd ( 2 million)
 Key suppliers of beef production – provide 75-80% take off
 Communal farmers
 Over 150,000 households on communal land
 Further sub-divided by location into 2 groups
 50% of national herd in NCA but less 2% sold in formal markets
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4. 4

5. Beef Supply Chain
DOMESTIC MARKET
22,000 MT

6. Cattle Marketed (2011)
Heads Price/head Total Value %
(USD) (USD)
Export Abattoir (EU) 125,000 675 84.3 mil 41%
Live Exports (SA) 200,000 484 96.8 mil 35%
Local Consumption 60,000 675 40.5 mil 17%
SVCF to NVCF 30,000 542 16.2 mil 7%
Meat Board of Namibia (2011)
 Weaner production system: most profitable
 Producers responding to high weaner prices & least costly
 Sell live cattle (exports SA)
 Weaner-ox system: least profitable
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7. Important Costs in Cattle Production
2009 Annual Ave. Cost/cow
Communal: N$ 273 (US $34)
Commercial: N$ 616 (US $76)
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8. Variables Results
Results: Participation Transaction Costs Related
Grade uncertainty (yes=1) -0.213* (0.110)
Farmer Organization (member=1) 0.440*** (0.0906 )
Transport vehicle (yes=1) 0.193* (0.108)
Distance to market (km) 0.000696 (0.00102)
Farmer Characteristics
Land Title (yes=1) 0.286** (0.124)
Family labor 0.234** (0.0980)
(relies solely=1)
Gender (female=1) -0.195** (0.0917)
Running water (yes=1) 0.162* (0.0958)
Farming time (full time=1) 0.0992 (0.112)
Own Herd 0.175 (0.195)
(% total herd owned)
Education 0.00845 (0.0107)
(years of schooling)
Experience 0.00367 (0.00394)
(years in farming)
N=200 Pseudo R2=0.32
Wald c 2 (12) =60.42*** % correctly predicted: 61
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9. Model 1 Model 2
Variables Proportion > 0 Proportion ³ 0
Results: Supply Decision Transaction Costs Related
Payment Delay (yes=1) -1.389*** (0.333 ) -1.389*** (0.367)
Grade Uncertainty -0.477 (0.328) -0.974** (0.401)
Premium (yes=1) 0.850*** (0.256 ) 0.467 (0.298)
Contract Type -0.499* (0.282 ) -0.461 (0.286)
(Direct=1; Indirect=0)
Distance (km) -0.00343* (0.00202 ) -0.00337 (0.00231)
Farming time -0.640*** (0.247) -0.868*** (0.298)
(full =1; part =0)
Transport Vehicle (yes=1) 0.389 (0.444) 1.117** (0.464)
Farmer Characteristics
Cost per head (N$/head) 0.000625**(0.00029 ) 0.000474 (0.000296 )
Running Water (yes=1) -0.604 (0.382) -0.0700 (0.418)
Hired Labor (number) 0.0489 (0.0440) 0.0335 (0.0451)
Total Herd 0.000775 (0.000670 ) 0.00133* (0.000719)
Gender of head (female=1) -0.211 (0.292) -0.312 (0.315)
Inverse Mills Ratio 0.377 (0.407) 0.858* (0.501)
Constant 0.293 (0.863) -0.459 (0.896)
Observations 75 93
Pseudo R2 0.403 0.466
Wald c 2 (12) 232.36*** 145.48***
AIC 1.261 1.110
BIC -249.12 -335.19
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10. Key Constraints Smallholder Competitiveness
 Communal Farmers
 Animal- disease status – farmers locked out of market
 Quarantine costs – in NCA
 Poor animal quality: advanced age, low carcass weight and low
nutritional status
 Cost of compliance – double-ear tagging (US$. 0.90/tag)
 Marketing structure – few buyers w/high bargaining power (e.g.
Agra 60% market share)
 Limited grazing (73%), bush encroachment (64%); theft (54%)
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11. Small Livestock
- Average Size 2001-2010: Sheep (2.1 mil) & goats (1 mil)
- Marketing: Sheep (50%) & Goats (26%)
- Primary export market: Goat: Kwazulu Natal
- Key constraint: predators major threat & high mortality (pasteurella)
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12. Capacity Building Efforts
 Support smallholder farmer organizations - significant role in farmers’
participation in formal markets and to achieve scale
 Farmer education: animal health, nutrition (esp. in NCA), productivity
 Limited grazing land: key constraint in market participation (need to
effectively access to land)
 Grade uncertainty & payment delay reduce incentive
 Explore other markets: regional markets
 Should animal health and traceability efforts be a public good?
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13. Competitiveness
Small livestock farmer competitiveness = (price, production costs,
quality; policy environment)
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