REQUESTED INTERVENTIONS TO ENSURE FOOD SECURITY, INCOME SECURITY, JOB SECURITY AND SOCIO-ECONOMIC SECURITY IN THE LIVESTOCK INDUSTRY TO DEAL WITH THE IMPACT OF THE DROUGHT Dr Pieter Prinsloo Vice-Chairman National Red Meat Producers’ Organisation

INTRODUCTION Livestock production in South Africa is a fundamental element of socio-economic development and a significant contributor to food security, food sovereignty and income security 70 % of agricultural land can only be utilised by livestock and game Livestock contributes to 27 % of consumer food basket 1,2 million households own livestock 60 % commercial 40 % emerging/subsistence

GROWTH PATH The livestock industry aligned itself with – NGP : New Growth Path NDP : National Development Plan IPAP : Industrial Policy Action Plan APAP : Agricultural Policy Action Plan It is all about growth, creation of employment, rural development and food and income security We as producer organisation and organised agriculture are and should be involved

PROVINCES ALREADY PROCLAIMED AS DROUGHT DISASTER © 2015 Agri SA 4 GP Pendi ng N Cape 29 Jan 2016 LMP 13 Nov 2015 E Cape 4 Dec 2015 KZN 20 Nov 2015 FS 4 Sep 2015 W Cape Pen ding NW 24 Jul 2015 MP 4 Dec 205

CommoditySevereModerate Minimal effect Maize Wheat Oil seeds - Sunflower - Soybeans - Groundnuts Beef & Sheep Poultry PorkPork Game Ostrich Wool and mohair Cotton Dairy Fruit Citrus Table grapes Wine Vegetables Potato Sugar Forestry Tobacco SUMMARY OF DROUGHT IMPACTS ON COMMODITIES © 2015 Agri SA

CRITICAL ASPECTS We have to keep nucleus herds in good condition through winter Current breeding season conception rate very important We need to up our % of calving and lambing to rebuild our national herd If help is rendered, it will take two seasons to recover IF NOT four seasons in the commercial sector and never in the emerging sector “Guestimate” - 5 % loss in national beef herd of 13 million - complete eradication of nucleus herds of certain individuals Emergent sector much more vulnerable

GENERAL CONDITION OF VELD “GRAZING” IN PROVINCES WCFSNCNWMPULIMGPKZNEP GOOD MODERATE POOR © 2015 Agri SA

DROUGHT HAS AN IMPACT ON SOUTH AFRICAN EXPORTS

RISK ANALYSIS Food insecurity Income insecurity Job losses Erosion of tax basis Socio-economic decline in rural areas Drastic increase in red meat prices

RECOMMENDED INTERVENTIONS BY GOVERNMENT IN ORDER TO SPEED UP THE RECOVERY OF THE LIVESTOCK INDUSTRY Subsidising the purchase of feed and fodder Providing and interest rate subsidy for herd rebuilding

BEST ESTIMATE OF FINANCIAL NEED OVER PERIOD FOR COMMERCIAL AND SMALL HOLDERS STARTING IN 2016/17 © 2015 Agri SA

Medium case total 3 years R Exponential impact is possible in each scenario TOTAL FISCAL OUTLAY REQUIRED IN THE 2017/18 AND 2018 FISCAL YEARS © 2015 Agri SA

FINANCING MODELS ANGEL FUNDING

RPO / UFS DROUGHT SURVEY RPO outsourced drought survey to the University of the Free State To determine and quantify the real impact of the drought in the livestock industry Random survey involving 40 farmers and 5 abattoirs per province –30 commercial farmers per province –10 emergent farmers per province

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