Livestock production in South Africa is as old as the hills. The sheep spotted by the first European seafarers on the South African coast is one of the reasons they set up a halfway station in the Cape – the sheep could supply fresh meat.
Like all industries, the livestock sector changed over time – various breeds of cattle and sheep were imported, and national herd and flock numbers rose and fell. In addition, consumer consumption patterns, the availability of other protein sources and the prices of the different protein options evolved.
In a new series, AgriOrbit will investigate the current market situation in terms of sheep and cattle production and consumption in South Africa.
National sheep and cattle numbers
Due to South Africa’s diverse natural habitat, large parts of the country are suited to livestock production. While this initially led to rapid growth in the livestock industry, this trend ceased in 1996, with a decline in the national sheep flock. The national cattle herd remained relatively constant until 2015 (Figure 1), when it too started to decline.
Figure 1: National South African cattle and sheep numbers from 1996 to 2019. (Source: Department of Agriculture, Forestry and Fisheries [DAFF], 2020)
Between 1999 and 2019 the national sheep flock decreased from approximately 29 million sheep to the current 22 million. While this 24% decrease in the national flock can be attributed to many factors, they all come down to the economics of sheep production. An agricultural producer needs to be economically sustainable to successfully run a business.
Once the risks associated with sheep farming in terms of predation, theft, animal health, higher labour intensity and price volatility started to overshadow the benefits of sheep farming, producers switched to beef and/or game farming. Lingering drought in especially the sheep-producing areas of South Africa over the past few years further assisted in the sharp decline of national flock numbers. Producers were forced to reduce flock size as they could not afford to keep feeding all their animals during difficult times.
While it took the sheep flock several years to decline, there was a sharp decrease of approximately 10% between 2015 to 2019 in the national beef herd. This decline can mainly be attributed to the drought, which forced producers to reduce herd sizes.
South African slaughter statistics
The decline in the national sheep flock and cattle herd can also be observed in the decreasing supply in terms of slaughter statistics for South Africa (Figure 2).
The last increases in sheep slaughter numbers occurred in 2013, 2014 and 2015. These increases were largely due to emergency slaughtering during the drought. Thereafter, the formal slaughter numbers continued to decrease each year. In 2019 South Africa slaughtered 1,24 million fewer sheep than in 2015 and nearly 720 000 fewer than in 2013, before the drought began.
However, one must remember that these statistics only represent the formal market. If the total sheep flock numbers are considered, the informal market is estimated to be approximately the same size as the formal market.
Figure 2: South African formal sheep and cattle slaughter statistics from 2013 to 2019. (Source: Red Meat Levy Admin, 2020)
Cattle slaughter numbers illustrate almost the same trend as that of sheep. The difference is that the last year that showed growing slaughter numbers was 2016, while 2019 was slightly higher than 2018. Even with the slight increase in 2019, South Africa still slaughtered approximately 324 000 fewer cattle than in 2016, and 53 000 fewer than in 2014, before the drought began.
A closing thought
In terms of supply, cattle and sheep numbers decreased over the years. In plain economics it should cause the price of the product (red meat) to increase, but this will only happen if everything else remains constant. The market environment changes constantly, however, and the effects of demand and other factors such as the disposable income of consumers should also be considered.
In Part 2 of this series which will be published next week, I will be focusing on demand.
– Dr Frikkie Maré, Department of Agricultural Economics, University of the Free State