13 November 2012

Namibia: Dairy Farmers Face Growing Threat

Photo: Fortune.
Seid Yemer was heading to home from shola market with his sheep herds on Thursday night.

Windhoek — The Namibian dairy industry is in dire straits and if authorities do not throw it a lifeline, this sector comprising 16 producers - excluding independent producers - could grind to a halt and ruin many small farmers.

The dairy industry is one of the shiny examples of excellence in local production. Chairman of the Namibia Dairy Producers Association, Kokkie Adriaanse, related this message of doom and gloom in an exclusive interview with New Era.

Adriaanse made it crystal clear that the Namibian producers of more than 700 000 litres of fresh milk per annum have reached the end of their tether because of unfair competition from South African suppliers, who flood the local market with long-life milk products at cheap prices, while not having to pay any import levies.

"The situation has become unbearable for us 16 Namibian milk producers, delivering a top-quality and hormone-free milk [product], while having to compete against unfair South African suppliers who sell their inferior products for almost N$2 per litre cheaper on the shelves of local outlets," said Adriaanse.

The infant industry protection regime which placed a levy on all imported dairy products ran its course two years ago and this resulted in South African producers flooding the Namibian market with excess supplies of milk, according to local producers.

Adriaanse says the South African competitors shift the emphasis away from their cheap long-life milk by staying competitive with Namibian produced dairy products such as yogurts and cultured milk.

Adriaanse also pointed out that local production costs are considerably more expensive, due to the vast distances between producers and factories. "It is a well-known fact that genetics only contribute some 25 percent towards the delivery of high-quality milk. Feeding makes up for 75 percent, and studies have shown how milk production can be boosted by using various hormones and other dubious substances. None of these feeding products are permitted in Namibia, and our milk producers deliver milk of the highest standard, but at a cost," said Adriaanse.

"Few Namibians make the effort to read the labels of these imported long-life milk cartons. What attracts customers is the cheaper price. No household goes without milk for a day, and therefore people will try and save by buying cheaper milk. But today's cheap milk could result in tomorrow's expensive hospital bills."

He said the Namibia Dairy Producers Association has already started negotiating with the Meat Board to have milk declared a protected product. This is a legal process and once again, will cost the association a heap of money. A draft has also been presented to the Ministry of Agriculture, Water and Forestry to explain the situation and to insist that all South African milk products also comply with every regulation. Another possible solution is to ask for a quota system to force consumers to support the Namibian products.

"The bottom line is that more than 120 jobs provided by producers are on the line, as well as the fear of more job losses at factories and dairies if we are to grind to a halt and fail to supply some 700 000 litres of milk anymore," he said. He said in conclusion that indications are that the authorities will pay heed to the Namibia Dairy Producers Association's plight. "But the situation is grave and a lot is at stake. We need help, and we need it now."

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