Research Report 2014/2015
Sources of protein
Local protein production
According to AFMA figures, the total oilcake consumption in South Africa for the period 1 April 2013 to 31 March 2014, comprised a total of 1 889 979 tonnes. That is an important milestone for the PRF because, for the first time more protein for animal consumption had been produced locally than that imported. Local production amounted to 1 197 604 tonnes, with imports of 686 511 tonnes protein.
The first 2012/13 crop estimate indicated the production of 914 350 tonnes soybeans on 516 500 hectares. Eventually only 784 500 tonnes were produced. In comparison, indications for the 2013/14 harvest year were that 502 900 hectares soybeans were planted, about 14 000 hectares fewer than the previous year. However, at the end of the season it transpired that 944 000 tonnes soybeans had been produced. For the PRF it was important that the 500 000 hectares were maintained, because it had been the estimate for the 2015 planting season. The one million tonnes estimated for the 2015 planting season remained evasive.
The initial 2014/15 crop estimate caused mixed feelings. The surface areas increased from 502 900 hectares to 687 300 hectares, but the first crop estimate amounted to only 938 350 tonnes. It seemed as if the magical figure of one million tonnes soybeans would remain beyond reach. Weather conditions were not particularly favourable for summer crops, but we were overjoyed to note the crop estimates committee's second semester estimate for 2015. For the first time the estimate was more than one million tonnes soybeans for the 2014/15 season.
Despite the gratitude about the PRF's attempts to establish improved self-sufficiency in terms of protein for animal consumption, AFMA poured cold water over the positive results and caused huge disappointment to the PRF. It transpired that AFMA was promoting the abolition of import levies on soybeans and soybean meal, irrespective of the negative effects such a decision could have on the local soybean industry. It is clear that AFMA completely ignored the history since 1973 in its totally unacceptable approach to the progress of protein production in South Africa. Of course the PRF and other institutions involved, such as Grain South Africa, fight this application with everything in their power.
The traditional web site study of the soybean industry, prepared once a year by Mr Jan Du Preez, rendered very interesting reading material and discussion. It was noted that Monsanto introduced a new product in the market, Roundup Ready 2. It is easy to understand why, because the legal protected lifespan status of Roundup Ready 1 would expire in 2015. The PRF will, as always, strive to obtain the improved genetic materials for South Africa.
New technology such as Roundup Ready 2 will not be introduced easily in South Africa without protection for seed companies against abuse by producers that retain grain as seed. During this period the late Mr Frans Potgieter suggested, for the first time, the possibility that Grain South Africa could introduce a system of end user royalties.
As had been the case every year, a Technology Committee think tank was convened, to ensure that the PRF remains at the cutting edge of various soybean production aspects. In addition, the Board also approved the recommendation to strive for an average soybean yield of 2,5 tonnes per hectare, including a yield of five tonnes per hectare under irrigation. The average producer yield in all provinces excluding KwaZulu-Natal, remain unacceptably low. It does relate, to a large extent, with the continuous entry of new players in the industry, but it is important for the PRF to address this unacceptable situation.
In this regard, Dr Jan Dreyer, member of the Technology Committee, conducted an in-depth study of soybeans under irrigation. We are waiting for the results of the study.
Some of the results of the Technology Committee think tank, included inter alia, to stop rust catcher trials. The PRF reports, with gratitude, that rust had not spread over the past few years and that it is still considered endemic on the eastern side of the Drakensberg.
In an attempt to use the latest technology to promote and expand soybean production, the PRF decided to produce a first web site video about soybean growing. The video is entitled "The A to Z of soybean production". The text was prepared by Mr Wessel van Wyk, soybean expert and PRF contractor.
The possibilities of a South African Soybean Association are being followed up and the investigation should be finalised in due course.
Technological progress in the international soybean industry is significant. In an attempt to remain abreast of progress and to separate chaff from the wheat, especially in terms of the most urgent South African requirements, the PRF decided to re-establish a Soybean Planning Task Team, but as a Planning Committee with the same status as PRF Board Committees. Regular information days, as well as a soybean symposium presented every two years, will be some of the first aspects to be addressed by the committee. The committee is expected to be sensitive to change in the actions of international companies represented in South Africa, to observe and participate.
Canola was produced in South Africa for the first time in 1992 and has a chequered history. Initially production growth went well but stagnated from 2003/04 until 2012/13.
In 2009 when the PRF decided to stop the funding of research on lupins a survey was also made with regards to the canola industry. During this period huge efforts and large amounts of money were spent on the development of canola production which certainly yielded unexpected and very surprising results.
In the report of 2013/14 it was reported that a record canola crop of 112 000 tonnes was produced on 72 165 hectares. In the past year this record was beaten when 123 500 tonnes of canola was produced on 95 000 hectares.
During the previous year under review, it was decided to present canola information days on 27 and 28 August in the Western Cape. Originally it was decided to invite Dr D Bowran of Australia to act as guest speaker, but when we presented the information days, we were privileged to have another Australian, Prof C Preston, as speaker too. The information days were definitely successful. It was decided to present the next canola symposium in 2016.
The Board confirmed its previous resolution that the future of canola relates largely to the availability of Roundup Ready canola. Much work has been done to realise it, but it will probably take another two years before these cultivars will be planted in South Africa. The struggling wheat industry will definitely also benefit from this.
Again, the annual canola web study prepared by Mr Jan Du Preez was again very successful and truly a huge stimulating factor to ensure that the South African canola industry remains up to date with the latest global technology.
During the season there were problems with the cultivar Zircon and no immediate answers were available. Fortunately, Dr Bowren could identify the problem as the so-called "Beet western yellows virus" (BWYV) and the identification brought calm to the canola industry and the seed companies involved, because they had the necessary information to act.
Expansion of canola to the central irrigation area on the Highveld remains under discussion and there will definitely more trial plantings to try and expand the canola surface area in South Africa.
Over the years, sunflower was one of the constant sources of protein for animal feeding in South Africa. The importance percentage may have faded, but it remains an important raw material for the animal feed industry. Inclusion levels of AFMA members vary between four and five percent. Annual imports of sunflower oilcake remain relatively high. In the 2014/15 period it amounted to almost 45 000 tonnes.
In the 2013/14 season, 832 000 tonnes of sunflower were produced on 598 950 hectares. During 2014/15 the hectares were reduced to 576 000 and the first estimate amounted to 938 350 tonnes. The final yield however, was only 660 900 tonnes.
Animal feed manufacturers
Animal feed requirements
The feed industry faces the challenge of providing increasing quantities of food at an affordable price while meeting the ever increasing quality requirements. The world formal feed production is estimated at 1 billion tonnes and 1,3 billion tonnes including farm mixing. South Africa at an estimated 11,4 million tonnes is ranked number 21 in the world with regard to feed volume produced. The increase in feed production in South Africa has grown at a steady average rate of approximately 4% per annum over the last 5 years.Table 1
|Animal products||Gross value (Rand thousands)|
|Poultry meat||33 810 000|
|Eggs||9 195 000|
|Cattle and calves slaughtered||17 693 260|
|Milk||10 195 442|
|Sheep and goats slaughtered||4 048 538|
|Pigs slaughtered||3 564 171|
|Other livestock products||3 182 616|
|Total||81 689 027|
Poultry, pigs and other consumers
Growth in per capita consumption continues to favour poultry with more poultry products being consumed than all other animal-protein sources combined. Poultry remains the most affordable protein source compared to other meat protein sources.
During the first half of the 2014 calendar year, the higher maize price and effect of imported chickens caused the broiler industry to sell their products below the cost of production. Despite the price of chicken remaining the same, the adverse economic climate meant that demand for chickens dropped due to lower consumer affordability. Many smaller producers were forced to stop production while others went out of business. Bigger producers reduced their chicken production and left houses empty and in some cases demolished older houses.
From June 2014, a record maize crop led to lower feed prices. Producers started to make profits again. In early 2015, a higher demand for chickens resulted in a shortage of chickens in the market place. Through restocking, houses were once again filled to capacity and production recovered.
Imports remained at more or less the same level as in the previous year. The same applied to the first five months of 2015.
The AGOA Agreement was finalised during June 2015. The anti-dumping tariff was dropped after pressure on the SA government. It was agreed that the USA will be permitted to export 65 000 tonnes of chickens to South Africa.
During the beginning of 2014, the egg producers also struggled with higher feed costs but with the reduction in feed costs in the second half of 2014, profits improved. Minimal trade of SA eggs took place in the global market as well as some trade within the African market.
Currently an estimated 958 million broilers are being slaughtered per annum (SAPA, 2014) to meet a per capita poultry meat consumption of 37,4 kg per annum, or approximately 2,049 million tonnes of poultry meat. Local production is currently complemented and limited by low cost imports of 393 303 tonnes occupying 19% of local poultry meat consumption. The value of poultry imports into South Africa during 2014 amounted to R3,658 billion.
Feed requirements of locally produced broilers is 2 782 529 tonnes of broiler feed per annum.
To supply the need for day old chicks during 2014 the average number of broiler breeder hens in production was estimated at 6,6 million consuming a total of 529 382 tonnes of feed including rearing feed.
Currently the number of laying hens in the country is estimated at 24,7 million (SAPA, 2014). These layers meet a per capita egg consumption of 7,94 kg per person or approximately 434 150 tonnes of eggs and 5 660 tonnes export.
Local production is currently geared toward the supply of the total local requirement with limited exports and tends to fluctuate between surplus and shortages to achieve this balance.
Total feed required for commercial egg production including rearing is 1 235 387 tonnes.
Sheep feed requirements
In South Africa lamb and mutton are produced extensively. Sheep slaughtered from the commercial sector at registered abattoirs amounts to 6,8 million per annum, producing 155 000 tonnes of mutton. Imports amount to 36 300 tonnes resulting in a total consumption of 182 600 tonnes of mutton or 3,7 kg per capita. The majority of sheep feed is in the form of supplements which is estimated at 237 564 tonnes. Feed required in feedlots amounts to 93 328 tonnes per annum plus 237 564 tonnes equates to 330 892 tonnes.
Cattle feed requirements
South Africa has a well-established feedlot sector with a standing capacity of 460 000 animals.
The total number of cattle slaughtered per annum at registered abattoirs is 2,90 million. Seventy percent (70%) of these cattle are fed in feedlots and with an average feed conversion of 7:1 over the feedlot period of about 127 days. This currently represents 2 698 000 tonnes of feedlot feed.
According to the Abstract of Agricultural Statistics (2013), 2,851 million cattle and 58 000 calves were slaughtered during 2011/2012 producing 823 000 tonnes of beef. During the same period 48 000 tonnes of beef was imported. The total of 871 700 tonnes therefore represented a per capita consumption of 16,74 kg per person.
The large discrepancy between beef produced from registered abattoirs and that reported in the Abstract of Agricultural Statistics can be attributed to the high number of informal slaughtering.
With the ratio of feedlot slaughtered animals at 70% the feed requirements are 2,698 million tonnes in feedlots and 357 000 tonnes of supplement feeds which constitutes total feed of 3,055 million tonnes.
Dairy feed requirements
Milk represents the third largest animal production sector after poultry and beef. The number of milk producers has decreased from 3 899 in 2007 to 1 834 in 2015, the main area of reduction being Mpumalanga at 74%. The trend of growth in production in pasture based areas continues. Average production per cow per day was estimated at 20,4 litres per day in 2014.
The current total milk production is 2 628 438 million litres per annum. The number of dairy cows in milk is estimated at 353 000 with 88 250 dry cows. At a 6 kg concentrate consumption per cow per day for cows in milk and 2 kg for dry cows, the feed required will be 837 492 tonnes per annum of concentrate. Total dairy feed amounts to 2 055 846 tonnes.
The pig industry and the pig feed requirements
The number of pigs slaughtered in abattoirs increased marginally in 2014 from 2,64 to 2,80 million with a resultant increase in the production of pork from 198 000 to 210 000 tonnes. The ratio of baconers to porkers slaughtered is in the order of 85:15. The average baconer and porker carcass mass yielded 78 kg and 57 kg respectively. Imports were considerably reduced in 2014, down to 18 500 tonnes from 27 600 in 2013 and 33 300 in 2014. However it appears that imports will hit a new record of about 44 000 tonnes in 2015. Feed requirement is 674 546 tonnes. The total locally produced and imported pork of 210 634 tonnes constitutes a per capita pork consumption of 4,27 kg per annum.
A concern to the pork industry is that the imports are no longer mainly ribs (previously, these made up 70% of imported pork, used mainly by the restaurant trade); currently ribs make up less than 50% of imported pork.
The national commercial herd now consists of 110 400 sows, but a producer in the Western Cape has started to build an additional unit for 4 800 sows which will start production by the end of 2016. Mixed messages are being received about the effect that such an increase in production will have on producer prices. Fortunately imports are up, so the demand for pork appears to be increasing in South Africa.
Delegations from Russia and Singapore came to South Africa in 2014 to investigate the possibilities of South Africa exporting pork to their countries. However, African swine fever and foot and mouth disease are endemic in certain parts of the country. The Russians were not convinced that the Compartment system being employed in South Africa to overcome this problem would ensure a safe export commodity. Singapore has not yet decided whether to import pork from South Africa.
Producer prices increased in the last half of 2014 to between R23 and R24 per kg in December, enabling producers to recoup some of the earlier losses incurred by high feed prices. It is likely that this situation will deteriorate with the maize price increasing because of the drought and exchange rate remaining under pressure.
The State Veterinarians Directorate of Animal Health (1998) states the number of horses in South Africa at 283 450. A large proportion of these animals estimated at approximately 156 000 are kept in the informal rural sector and it is assumed they are not fed any form of formal concentrated feed.
The number of racehorses is estimated at 8 650, breeding and registered horses 9 000, riding schools and polo horses at 6 000. Hacks are estimated at 10 000 and the balance of 93 800 to be on farm.
On the assumption racehorses, breeding horses and working horses are fed 3 kg concentrate per day and hacks are fed 2 kg per day, the total horse feed consumed will be 121 047 tonnes per annum. This figure can be assumed to remain constant.
The ostrich industry used to place emphasis on the production of hides for highly priced leather products with 32% of income from hide production, with meat making up 62% and feathers 6%. Due to its low fat content, ostrich meat has grown in demand and from there the 62% referred to above.
Ostrich production in South Africa is estimated at 75% in the Western and Southern Cape while the Eastern Cape produces 20%.
The number of ostriches slaughtered in 2013/14 is estimated at 120 000. This figure is estimated to increase to 180 000 in 2014/15 in anticipation of a more buoyant market.
At an average weight of 95 kg with a feed consumption of 4,3:1 the consumption of feed by growing birds is 73 530 tonnes per annum. At an average of 20 chicks per hen per year the number of breeding ostriches required is 9 000 consuming 3 kg per day the requirement of feed for laying birds is 9 855 tonnes. The feed consumption of 2.4 kg per bird during breeding bird rearing amounts to 21 600 tonnes.
The total ostrich feed consumption per annum is 104 985 tonnes.
The presence of Avian Influenza still has a significant detrimental impact on the Ostrich industry with a ban on the majority of ostrich meat exports.
National production of pet foods in South Africa is currently estimated at 325 789 tonnes according to the pet-food association (Hundley 2015).
Total feed requirement
Total feed requirements for different farm animals are shown in Table 2.
|Feed type||Metric tonnes|
|Dairy||2 055 846|
|Beef and sheep||3 387 408|
|Layers||1 235 387|
|Broilers and breeders||3 311 912|
|Total||11 423 765|
The South African Feeds Industry has had a steady growth in demand and consequently protein demand has grown and is predicted to continue this trend in the future. National feed consumption has grown from a predicted 7 609 777 in 2000 to 11 077 215 in 2014 a growth of 45,56%, or average of 3,25% per annum. The demand for protein, in particular soybean meal, has grown significantly. In 2005 locally produced soybean meal comprised 37 200 tonnes, while imported soybean meal comprised 635 174 tonnes. This has changed dramatically and in 2014, 655 839 tonnes of soybean meal was produced locally, representing a growth of 1663%, while imported soybean was an estimated 610 022 tonnes, a reduction of 4%. Over the same period, total locally produced oilcake equivalent (all oilcakes) grew from 635 174 tonnes to 1 172 823 tonnes, while imported oilcake equivalent (all oilcakes) declined from 1 414 338 tonnes to 855 529 tonnes.
Projections 2015, 2020 and 2025
Based on the current per capita animal product consumption, the feed required for South Africa is 11,67 million tonnes. Using the predictions in growth in per capita animal production consumption as determined by BFAP and the projected population growth, feed requirements will grow to 14,63 million tonnes in 2024, an annual growth rate of 2,5%.
Over the same period soya oilcake usage will grow from 1,32 million tonnes to 1,884 million tonnes or by 8,3%. Total oilcake requirements will increase from 1,94 million tonnes in 2015 to 2,77 million tonnes in 2024, a growth rate of 4,7%.
Currently 61% of protein consumed in South Africa is local. This is expected to increase to 80% by 2024. Soybean meal and full fat soya produced domestically currently makes up 63% of total soya consumption. By the year 2024 this is expected to be 92,3%. Local protein production will need to increase by 14,74% per annum to reach self-sufficiency in RSA by the year 2024.