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Presentation by Derek Baker at the South African National Beef and Sheep Conference, Pretoria, South Africa, 21 June 2012.
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South African National Beef and Sheep Conference, Pretoria,
South Africa, 21 June 2012
African beef and sheep markets:
situation and drivers
Derek Baker
International Livestock Research Institute
Outline
1. Basic quantities, projections
2. The nature of sheep and beef markets
3. Drivers of change
4. Opportunities and challenges faced
… emphasis on developing countries in Africa
Numbers of animals
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
19
92
19
93
19
94
19
95
19
96
19
97
19
98
19
99
20
00
20
01
20
02
20
03
20
04
20
05
20
06
20
07
20
08
20
09
20
10
Sheep numbers
Other
Oceania
Europe
Asia
C + S America
N America
Africa
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
19
92
19
93
19
94
19
95
19
96
19
97
19
98
19
99
20
00
20
01
20
02
20
03
20
04
20
05
20
06
20
07
20
08
20
09
20
10
Cattle numbers
Other
Oceania
Europe
Asia
Cent + S America
Nth America
Africa
Global cattle (2010) 1.4 billion
Global sheep (2010) 1.1 billion
(7% decline in 20 years)
(9% increase in 20 years)
FAO, 2012
Consumption numbers: a World view
Based original figure by IFPR/John McDermott 2012.
Demand: increasing
in the developing world
Rosegrant et al. 2009
The 4 billion people living
on less than $10 a day
constitute a food market of
US$ 2.9 trillion per year.
(Hammond et al 2007).
-50 0 50 100 150
Africa
Asia
Latin America
North America
Europe
Other
Develped
Developing
Global meat consumption more than
doubled (129=>285 MT).
Of the more than 150 MT increase,
Asia accounted for 100 MT.
African consumption increased
less than 10 MT
Million metric tons of meat
Recent consumption change: 1982-2008 disaggregated by region
FAO, 2009
Per capita Meat Consumption, in Selected Countries in Africa and the World, 1990 and 2008
Beef Pigmeat Poultry Total
Kg/caput
1990 2008 1990 2008 1990 2008 1990 2008
Uganda 4.7 3.5 3.3 2.8 1.7 1.6 12.0 9.6
Chad 12.6 8.7 0.6 0.5 2.9 3.9
Ethiopia 4.9 4.5 0.0 0.0 0.8 0.7 9.5 8.4
Tanzania 7.3 6.1 0.3 0.4 1.0 1.3 10.3 9.3
Malawi 1.8 1.2 1.1 2.0 1.2 1.3 4.5 5.0
Mozambique 3.1 2.1 0.9 0.7 2.1 3.0 2.1 3.0
Niger 3.7 2.9 0.2 0.1 2.8 2.2 2.8 2.2
Nigeria 2.4 2.1 1.2 1.6 2.0 1.7 2.0 1.7
Africa 6.5 6.6 1.0 1.0 3.3 4.9 13.8 15.6
Developed 27.4 27.6 29.1 28.4 19.7 28.4 79.8 81.9
Developing 5.2 6.5 8.3 12.0 3.6 10.1 18.7 31.5
World 11.3 11.0 13.6 15.1 7.7 13.9 34.3 42.1
Consumption per capita: 1990-2008
African consumption per capita has increased far more slowly than in the
rest of the world
-10 -8 -6 -4 -2 0 2 4 6 8
Africa
Asia
Latin America
North America
Europe
Oceania
Other
Develped
Developing
Million metric tons
NET MEAT TRADE STATUS, 2008
Key Importing Regions:
Asia: 40% imports
Europe: 22% imports
N. America: 10%
Africa: 1%
Key Exporting Regions:
N. America: 30%
Latin America: 30%
Europe: 13%
Oceania: 12%
Africa: 1%
World trade in meat: Africa’s role
FAO, 2009
• By 2050 Africa is estimated
to become the largest world’s
market in terms of pop: 27%
of world’s population.
• Africa’s consumption of
meat, milk and eggs will
increase to 12, 15 and
11% resp. of global total
African demand and consumption: looking to the future
FAO, 2009
less beef
more poultry
Projected % shares of projected total meat consumption
0.46
0.23
0.11
0.19
2005 / 07
BEEF
MUTT
PIGM
POUL
0.43
0.21 0.12
0.24
2030
0.40
0.19 0.13
0.28
2050
Changing African meat consumption: 2005 – 2030 – 2050
FAO, 2009
Consumption: demand and markets
Based original figure by IFPR/John McDermott 2012.
Demand: willingness to pay for meat products’ quality and safety
Jabbar et al. 2011
Ethiopia: % of consumers WTP a
price premium for beef attributes
Low
income
Middle
income
High
Income
Safety 53% 63% 81%
Good quality 51% 64% 83%
Kenya: WTP for beef attributes
Attribute
Premium
(USD/kg)*
Official inspection stamp 1.42
Cleanness of the meat 1.12
Soft texture 1.00
Low fat cover 0.62
* approx, due to exchange rate change
Public health in informal markets
Food safety: informal markets are
often beyond the reach of regulation
W. Africa 1966 – pastoral system
W. Africa 2004 – crop-livestock system
The changing nature of livestock systems
Courtesy of B. Gerard
Land use
Mixed systems in
developing countries
produce ca. 50% of the
World’s cereals
Feeds
Projected increases in African livestock
numbers often fail to take account of feed
constraints.
Extensive grazing/pastoral systems have
probably reached their carrying capacities.
• Monogastric species: grains + spec. feeds
• Dairy: fodder crops + crop residues + by-
products
• Ruminants: some crop residues + grazing
(often communal + public + other)
African marketing systems: in general…
• Low off-take rates
o Multiple uses of livestock
o Crop-livestock interactions
o Low productivity
o Lack of information
o Risk management
o High transaction costs
• Lack quality standards at all levels
• Smallholder dominated
• Informal
• Lack vertical co-ordination
o Payment
o Quality and quantity/timing/inputs
• Beef + dairy interaction
• Complex seasonality
Co-ordination - 1
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Vaccines Dips Anti-worm Treatments Other% o
f each a
cto
r gro
up r
eport
ing u
se o
f e
ach a
nim
al health p
roduct/
serv
ice
Allocation of animal health tasks/actions
producer co-operative feedlot butcher
Source: ILRI beef VC survey in Ethiopia
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
producersales
traderpurchases
feedlotpurchases
butcherpurchases
% o
f all
sale
s/p
urc
hases t
hat
are
w
et
seaso
n s
ale
s/p
urc
hases
Seasonality in sales and purchases
Bulls
Cows
Heifers
Ox
Source: ILRI beef VC survey in Ethiopia
Co-ordination - 2
Source: ILRI beef VC survey in Ethiopia
Co-ordination - 3
0
1
2
3
producer trader feedlots meatplant
retail broker co-ops
Score
s o
f th
reem
ost-
cited
attributr
es
What “the buyer” wants
Breed and colour Age Length or size Health
Condition Ability to plough Place of origin
Opportunities
• Raising productivity
o Breeds
o Feeds
o Animal Health
o Training, knowledge/extension
• Exploiting consumer demand elements
o Specific safety/quality attributes
o Lifestyle and convenience, ethnic markets
o Population growth
o Regional trade
• Value chain cost efficiencies
o Scale and scope, esp. via structure
o Co-ordination, transaction mechanisms
o Storage and transport
• Rural services
o Financial
o Technical
o Risk management
Challenges
• Appropriate breeds
• Feed
• Environmental carrying capacity
• Access to land, water
• Market structures
• Barriers to market entry (all levels)
• Identifying and serving high WTP
• Understanding consumption trends:
population vs per capita vs WTP
• Competition from imports
Research tasks
• Productivity
o Animal health
o Breeding
o Genomics
o Feeds and feeding
o Access to inputs
• Environment and climate change
• Human health and nutrition
• Market participation
• Whole-chain approach
o Co-ordination around quality and quantity
o Identifying smallholder/commercial synergies
o Incentive-based change
o Seasonality
o Commodity-based trade
• Policy environment
