Beefy Exports: Opening Up the Beef and Meat by Products Industry

According to FAO, the world has 1.468 billion head of cattle, and Botswana has 2.5 million of that herd, and it is estimated to account for less than 2% of Botswana’s GDP.

On the other hand, Botswana is a cattle country dating back to pre-colonialism, and its post-independence has not disturbed its model of communal cattle ranching that is has commercialized over the decades to ensure sustainable development. In 2015, the Botswana Institute for Development Policy Analysis conducted a research to investigate Botswana’s beef export competitiveness using indices of Revealed Comparative Advantage (RCA) and data for the period 1961-2011.

Results indicated that Botswana has been the most competitive SADC beef exporter, and that it has compared well with the leading world beef exporters, however, the country has recorded declining competitiveness since the mid-1970s. It is argued that, state trading export operations and non-reciprocal trade preferences with the EU have enhanced competitiveness through facilitating export market access. However, the single channel exportation arrangement, through a loss-making state trader, is a potential threat to beef export competitiveness.

Further, recurrent outbreaks of cattle diseases and drought, and the rise in domestic demand for beef (coupled with stagnant domestic supply) have adversely impacted beef export competitiveness. In June 2019, “Botswana has launched a process involving privatization of its loss-making beef exporting firm Botswana Meat Commission (BMC). This follows a report by auditing firm, KPMG Botswana which recommended that BMC should be privatized as a way of liberalising Botswana beef export market”, reported The Southern Times.

The privatization of the BMC creates an open field for more entrants into the export market, as cattle herders will have options; that being a major growth factor to the communal and small-scale farmer who own 80% of the export beef sent to the commission. The Weekend Post, reported that the “BMC has been protected from export competition, with several privately owned and local council abattoirs, as well as a large number of local butcheries that undertake slaughter having been restricted to supply only the domestic market.”

Read more in Moakanyi Magazine.

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