BMC output continues to slide
Botswana Meat Commission’s ( BMC) production continues to slide, despite efforts by the company to engage stakeholders to address cattle population and improve production parameters.
With the advent of COVID- 19 pandemic, the ailing production situation is now teetering on the brink, as the company records low volumes output, attributed to the prevailing reduced cattle supply from farmers. The BMC spokesperson, Brian Dioka confirmed to Botswana Guardian that the business has reduced its production scale, though making efforts to meet demand from its markets, both local and foreign. “This therefore meant that while averagely, BMC production would range between c. 120, 000/ annum ( 53- 60 percent) of designed- plant utilization on a good year, this time around utilization dropped to levels of c. 30, 000/ annum ( 15- 25 percent).
“This therefore challenged the business to re- prioritize its selling – by focusing on critical orders, and instead of servicing all the 52 countries we had access to - the focus became more on fulfilling the annual 1,600 metric ton fixed Norwegian quota, and also ensuring protein- security for Botswana market,” said the spokesperson. The challenge to secure enough cattle from farmers has previously led to BMC’s Francistown abattoirs being placed under care and maintenance. However, farmers are celebrating government’s recent decision to allow individuals to export live cattle for sale, which BMC views as a huge dent to the country’s beef industry.
Dioka bemoaned that though the impacts of live cattle export are documented and known, authorities went ahead to implement the policy. He highlighted that the effects of the policy are perennial non- performance of the BMC and fatigued confidence on the BMC by farmers and other stakeholders.“The live cattle export in the shortterm looks profitable for farmers, but however has far- reaching long- term effects to Botswana beef as a competitive or attractive product- brand or Intellectual Property ( IP) and source- of- origin in global markets as well as the sector, whose cattle population is seriously under- threat. “The cost of this on BMC, is obviously unsecured throughput for current and future operations, but also adverse
design- plant capacity utilization to levels where profitability of BMC cannot be possible,” said Dioka, emphasizing that capacity utilization at current is below 25 percent, when it is normally at above 53 percent.“BMC remains challenged in securing adequate raw material ( throughput) for its operations, and this was amplified by the COVID- 19 pandemic which limited movement of people ( farmers), but also due to BMC’s liquidity challenges, to enable to pay all creditors & farmers within a more desirous turnaround,” he highlighted.
The BMC mouthpiece further said the industry benchmarks stipulate that any beef processor should at the minimum ensure 85 percent of plant utilization or offset this by having incomparable quality of raw material ( throughput) with very higher carcass- weights above 260Kgs, to attempt profitability and sustainability.
“The two factors have been inhibited, for a very long time, by the glaring decline of cattle population in Botswana ( which was last published at about 1,7 million in 2018) as well as our cattle production system – which demands managed- feeding/ conditioning cattle before slaughter, yet not been widely practiced.” Other challenges affecting BMC during the prevailing pandemic include additional expenses to combating COVID- 19 such as personnel protective equipment ( PPE), sanitizers and scheduled fumigation. Meanwhile, the BMC has started its 2021 production year, by completing annual plants’ maintenance in all its operations.
As part of its resilience efforts, BMC last year managed to clinch the China market, while USA and UAE remain also within reach. “The important message here is that BMC does not want to conquer all countries as if we are a big- volume/ mass producer – but that BMC has set a vision to increase only its lucrative- markets’ base which are more of a niche and willing to pay a premium for Botswana beef,” said Dioka.