A Path to Prosperity New Directions for African Livestock

3 The Competitiveness
of Livestock Production
African livestock production remains highly
un-competitive in global terms. Several
parameters reflect this:
> Livestock yields are relatively low, for example:
• Young weaned cattle gain no more than 50 kg
per year in the transhumant system in West
Africa, which means that it takes five or six
years to produce a 250-kg animal 125 .
• Sub-Saharan Africa records the lowest milk
and meat production per animal (6.8 kg of meat
and 24.8 kg of milk per animal per year in the
mixed farming systems) 10 .
> Prices are relatively high, for example:
• Brazil exports chickens at a cost 25% below
that of Senegal’s poultry industry, due to the
competitiveness of its production stream, which
has low labour and raw materials costs 22 .
• Brazil, Argentina or Australia are able to ship
beef carcasses to Africa at about US$1/kg
(carcass price for the producer), which is 40%
less than the going price in West Africa. 22
> Import/export figures:
• SSA accounts for less that 2% of globally traded
livestock products.
• African production is not keeping pace with
demand. Net imports of all livestock products
are growing rapidly (see Figure 2) and cost the
continent approximately US$ 5 billion in 2007.
Three key problems are holding back
competitiveness:
1 Low on-farm productivity in terms of:
• output per animal,
• the cost of production (labour, feed, electricity
etc, influenced by scale of operations),
• on-farm efficiency. Animal mortality, morbidity,
reproduction rates and feed conversion are all
impacted by animal health and nutrition.
An example of one disease’s (trypansomosis)
impact on production is shown in Box 2.
This applies to nearly all key production systems in
SSA
• Pastoral systems, typified by a negative policy
environment, low levels of infrastructure,
remoteness, poor access to markets, services
eg. veterinary, access to credit, education and
seasonally poor nutrition with recurrent
disease and drought shocks.
• Small family-based livestock operations
(poultry, dairy animals, etc.), often run by
women, have proven themselves able to
generate additional income and cover on-farm
consumption. However, without support, they
struggle to supply consistent demand for
higher quality products in a reliable manner
(see Nestlé case study Box 7, Section 6.3).
• Intensive systems, mainly found near towns
and cities, include intensive production of
poultry and pigs plus dairy operations,
struggling to meet international sanitary,
feeding and technical standards.
2 Market access:
• transaction costs are high with large numbers
of intermediaries; road transport is expensive
due to poor road condition and milk or live
animals being transported long distances
(if walked they lose condition).
• the cost of doing business is high (local taxes,
regulations, licenses, cost of compliance of
adhering to SPS standards).
• Africa’s producers are generally not competitive
in global markets. (However, whilst high
logistical costs raise prices and are a significant
barrier to exports, these same logistical costs
also provide a shield for domestic producers
from imported commodities).
3 Product quality:
• Difficulty in adhering to technical standards,
quality attributes (size, type of cut, etc), lack of
downstream infrastructure (agro-industry)
such as abattoirs, processing plants, eg.
wholesale butchers able to supply structured
markets such as tourism and the public sector.
The Impetus Strategy Paper I Page 17