Ostrich product exports may face challenge
February 1, 2008
By Ronnie Morris
Cape Town - South African ostrich producers, the biggest exporters of ostrich meat and leather to the EU and other markets, could face tough competition in the future from Brazil and China, Francois de Wet, the chief executive of Mosstrich, the world's second-largest ostrich processor, said yesterday.
De Wet said these countries were, however, still not allowed to export to the EU, while the volumes in Australia and Israel were too low to be a threat to South African exports.
The company, which slaughters about 70 000 ostriches annually, specialises in the supply of ostrich leather and meat to international markets.
Founded 10 years ago, it is owned by 180 ostrich farmers from Bredasdorp to George as well as Ladismith to Willowmore. Its has 220 workers in the group's abattoir and tannery, who together hold a 6.5 percent stake.
The ostrich leather is largely used for boots, handbags and leather accessories in Europen and Asian markets.
Mosstrich had increased its turnover by 26 percent to R224 million, De Wet said. A pre-tax profit of R21.5 million was achieved, of which R14.7 million was declared as production bonuses and paid out to ostrich producers. An additional R2.5 million was paid out at the company's annual general meeting earlier this week for ostriches slaughtered in the four months following the end of the financial year, he added.
"The ostrich industry is like a rollercoaster but we're not too loudmouthed and remain humble about our achievements. It could take just one case of flu and we're right back at the bottom," he said yesterday. Speaking at the meeting, De Wet said the good results were due to several factors, including that the company could once again export ostrich meat to the EU for an unbroken period of a year.
"The exchange rate of between R9.50 and R10 per euro was favourable to exports. Productivity in the abattoir and the ostrich tannery was good, the demand for ostrich leather was satisfactory and staff focus on improvement played an important role," he said.
De Wet praised the Ostrich Chamber of Commerce, which in co-operation with the agriculture department kept the critical export channels to Europe open.
While inspections by the EU highlighted several shortcomings, the department was doing its best to correct the mistakes in order to safeguard meat exports to the EU - the lifeblood of the industry.
"Although crocodile is currently the exotic leather in greatest demand worldwide, the demand and supply of ostrich leather is reasonably well balanced. The leather is mostly sold in the US and although the average exchange rate of R6.60 to the dollar over the past year was still lower than the industry would have liked to see, it was a substantial improvement on the previous year's levels of below R6 to the dollar," De Wet explained.
During the past two seasons, Mosstrich had diversified by slaughtering a range of game and exporting the meat to Europe during the low season for ostrich products in winter.
"During the year we handled approximately 26 000 springbok, as well as a quantity of kudu, zebra, blesbok and blue wildebeest," said De Wet
Its existing distribution channels in Germany, Switzerland, Belgium, France and Holland also served for the export of game, De Wet said.
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