Botswana Meat Commission (BMC) had lost much of its market share to local and regional markets offering beef producers a competitive return on their investments, hence its recent price restructuring, anticipating to regain its place in the market.
By August 2021 from 2020, Lobatse Abattoir reportedly slaughtered approximately 6000 while Maun slaughtered around 4000 cattle, a significant low throughput compared to the previous years with its market share dropping from over 50% to 19% in 2020. Regional markets surpassed BMC, competitively receiving 146, 900 of live cattle during the same period.
BMC has observed that other markets offered reasonable payment timelines of within 7days which affords business confidence unlike its previous 30 to 90 days payments timeline after slaughter. To give producers assurance,BMC promises that payments will be settled within 14days after slaughter.
“BMC has already settled payments for cattle slaughtered on the 1st September 2021, 8th September 2021 and 10th September 2021 on the agreed due dates”, Acting Chief Technical Advisor Mr BosielaSaudu said, in an email interview.
Mr Saudu said that producers also expressed dissatisfaction on payment on the less than 180kg carcasses by BMC.
“Producers reasoned that BMC punishes them for their small frame Tswana cattle which are not finished before slaughter. Therefore, this beefed up competition supplies as these animals attracted good price locally”, he said.
BMC want its valued producers to realise better returns through this change in the pricing structure. As at 1st September 2021, beef producers started to enjoy the new P5.00/kg increase, resulting in a 40% improvement in throughput since the new Cold Dressed Mass (CDM) prices, and an amount of P1.581.801,40 paid so far for 905 cattle slaughtered at Lobatse and 809 at Maun Abattoirs within 14 days respectively.
Furthermore BMC wants to occupy its position as the buyer of choice either locally and regionally as the changes will enhance competitiveness in the industry, according to Saudu. He said that this will further lead to increased throughput which is mainly desired by BMC, resulting in its increased off-take share percentage and therefore positively impact its financial position.
Another change brought about is that BMC will start to receive cattle for both EU and other markets for slaughter at its Lobatse plant on Sundays until Thursdays effective August 2021, compared to initially Mondays to Thursdays.
