Livestock industry warned of ‘Dutch disease’

The discovery of oil offshore of Namibia – alongside efforts to develop a green hydrogen industry here – may threaten theNamibian livestock sector.This is the stern warning of Professor Helmke Sartorius von Bach of the University of Namibia’s (Unam) faculty of agriculture and natural resources, who advised stakeholders in the livestock industry to prepare for the future.Von Bach was a guest speaker at Okabra Farmers’ Day, which was held at Mecki Schneider’s family farm Okamutombe in theGrootfontein district under the theme ‘Building resilience in livestock farming’.“For Namibia, these new developments have the potential to bring significant national economic benefits, create employment opportunities, and to stimulate infrastructure development in general. [However], if not managed carefully, it can lead to ‘Dutch disease’ for the livestock industry,” he warned. Dutch disease is an economic term for the negative consequences that can arise from a spike in the value of a nation’s currency. “It is primarily associated with the new discovery or exploitation of a valuable natural resource and the unexpected repercussions that such a discovery can have on the overall economy,” Investopedia said.According to Von Bach, the likely effects for the short- and medium-term are:&bull; Stronger currency weakens exporting commodity revenues, such as livestock, grapes, tourism, etc&bull; Heavy dependence on new benefits might cause a shift in primary national objectives&bull; Diverted attention away from the rural economy, and neglecting human capital development&bull; Rapid industrialisation, urbanisation and population growth can lead to social disruptions&bull; The Namibian economy may be exposed to revenue instability, caused by fluctuations in oil andhydrogen prices.CLIMATE CHANGEVon Bach said the livestock sector provides a livelihood for almost 70% of Namibians and has historically contributed significantly to the economy, but the sector is impacted by declining biomass stocking and profitability.He asked: "So, do we need adjustments to shape this sector?"According to the World Economic Forum, global uncertainties include weather changes, animal health, renewable energy, stock levels and tradability, geopolitics and forces of demography. Local driving forces for uncertainties in the livestock sector are rangeland degradation, carrying capacity, animal health, livestock production losses and climate change.“Biomass forecasts point out that the current livestock farming environment and control measures are detrimental to boththe natural environment and farmers’ sustainability,” Von Bach said. “Although agriculture has been prioritised to drive economic growth, it is questionable how high the livestock sector is rankedin the list of national priorities.”He described what future livestock utilisation might look like: “All other things being equal, because of the low profitability inarid Namibia, it is essential to develop an in-depth analysis that will guide future transformation and build resilient livestockproduction systems.”He said a constrained prospective forecasting method was applied to estimate the Namibian livestock utilisation for the coming four decades. “Implications to the farmer involve where you could use 82% of your 5 000 hectare farm, for the next 37 years only 3 130 hectare is available for livestock production under ceteris paribus.”BECOME RESILIENTVon Bach warned Namibia will be classified as a net importer of red meat by 2056. His suggestions to become resilient are:- Take responsibility for introducing drastic interventions to turn around further degradation of the rangeland like prioritising Namibia’s National Rangeland Management Policy and Strategy.- Take responsibility to reverse livestock production loss to enable a conducive production environment.“Tenure systems must be re-evaluated to address sustainability. Reshape livestock value chains; sharpen competitiveness, preparedness, product consistency, certainty, biosecurity, property development, etc.“Enable farmers to progress from low-productivity subsistence agriculture to high-value efficient production. Introduce youngerfarmers,” he urged.- Take action to address climate change impacts on livestock production.“Invest in research and development and coordinate risk arising from climate change, biodiversity and environmental degradation.” He also suggested investing in early warning systems and implementing the drought strategy.“Reappraise the network of public sector extension workers in the field, specific to livestock production zones, based on more robust and focused economic analysis.”HELMSMAN AUCTIONThe successful Okabra Farmers’ Day ended with the Helmsman auction of ten Brahman bulls. Well-known Brahman-breeder Sidney Martin purchased the bull Okabra Aton for N$172 000. Four of the 10 bulls on offer were sold.– francoise@nmh.com.na

Livestock industry warned of ‘Dutch disease’

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