The Red Meat Producers Organisation (RPO) put forward two drought-related scenarios for the red meat industry: one if the drought is soon broken and one if the drought persists.
According to a RPO statement, the drought is the worst in 20 years and has severely impacted livestock numbers. Feed and water supply incurs high costs and farmers have been forced to scale down their herd sizes. It will take between three and four seasons for commercial producers to recover economically, even with normal rainfall levels.
The RPO has put forward the following two scenarios:
1. If the drought is broken and SA receives normal rainfall for the rest of the season, farmers will work hard to rebuild their herds. This will cause a supply deficit , which will influence meat prices in both the medium and longer term. Lambing and calving percentages will be lower, as female animals will not be in a good condition following the unfavourable conditions.
2. If the drought continues, more young female animals will be slaughtered, which could influence calving percentages going forward. Although producer prices will be somewhat lower, consumer prices will increase due to increased grain and feed prices and the lower supply of slaughter stock from farms.