Nadhem Mtimet, ILRI
Maputo, July 2018

2
The purpose of this presentation is to:
- Discuss the proposed cattle fattening business opportunity
- Provide updates on the progress made so far and next
steps
- Gather feedback and address questions
Why are we here ?

Agenda
The opportunity – an affordable and
profitable approach to cattle fattening
Profit sharing and investment
Discussion and questions
3
Discussion and questions
Progress and next steps

There is a need to enhance livestock (including
cattle) production and marketing, and improve its
quality
4
Mozambique is beef deficit country because of the low cattle population
and the low offtake rates
Current situation
• Livestock contributes significantly to food security across the Southern
African Development Community region
• In Mozambique, cattle are raised traditionally in an extensive manner on
natural pastures (55% of agricultural land)
• Low cattle population to meet the high demand for meat and livestock
products in the country.
• Local meat production covers part of the demand, while the rest is
satisfied by imports from South Africa and Swaziland.

Niche market plus government willingness to
increase locally produced meat and reduce imports
5
Cattle fattening will improve the productivity and the quality of the meat
proposed to consumers in Mozambique
Opportunity
• The demand for beef in Africa in general, and in Mozambique in particular
is significant
• Political willingness from the government. In 2017, the Mozambican
Ministry of Agriculture challenged the country’s livestock farmers to
develop a strategy that would promote selling good quality meat on the
domestic market
• Supply is not set to keep up with demand
• Niche market of high and middle income class of consumers in main cities
like Maputo, looking for quality meat

Feedlot fattening using forage, grass and crops residues
is not very complex and much cheaper than normal
fattening
6
Access to land and irrigation will provide access to cheap feed that
works, more profits are made
Fattening group operations
Collect store and mix
2
Grow the feed – forage and grass based1
80% cheaper, grown all year round
Group
members
In
3
300 kg 5
400 kg
Out
Feed, 3-4 months
4?

We have spoken to financial institutions and they
are interested in providing funds for/being part of
this process…
7
Financial institutions will fund groups, if the latter are given the skills
and support required, in addition to the access to a guarantee fund.
Group Company
Funding
Bank
How?

…training and support will be provided by PROSUL
project team: ILRI and SNV, for free
8
New skills will benefit individual group members in the future as well
Group Company
Funding
Bank
Buyers?
Training & support

…we are also approaching buyers who would buy
finished cattle at fair prices…
9
There is a high demand and buyers who pay the best prices will benefit
from the supply of finished cattle
Group Company
Funding
Bank
-
- Slaughter houses
- Retail butcheries
- Supermarkets
Commercial market
Training & support

To summarise, the model incorporates primary
elements required to improve the chances of
successful implementation
10
Finishers/Traders
Producer
Meat
wholesalers
Retail
butcheries
Other input and support
services
- MoA & FS: DVS
- Agric. Extension
services
Technical partner
Financial partner
Traders
Group
Commercial market
External
Fodder,waste,grass

Swazi Beef Project Feedlot
11

Agenda
The opportunity – an affordable and
profitable approach to cattle fattening
Profit sharing and investment
Discussion and questions
12
Discussion and questions
Progress and next steps

The rewards are high, but hard work, patience and
effort is required…
13
Groups who stay the course and are successful will have access to
more funds to grow
E 8,100.0
$8,100
$1,690
$820 $10,610
$11,460 $850
$0
$2,000
$4,000
$6,000
$8,000
$10,000
$12,000
$14,000
Cost of cattle Operational input
costs
Finance costs Total costs Revenue per cycle Net Profit
Labour Concentrate mix Transport Vet Energy Petty cash Finance
Input Costs, Revenue and Net Profit Per Cycle, (USD)
Total costsOut – costs
In – Sale
of fat cattle Profit

…profits will be split fairly after every cycle, based
on the quality and performance of animals
14
2 cattle per member
300 kg and
meets age
criteria
250 kg and
meets age
criteria
400 kg
325 kg
In Out
Larger Member
contribution to
weight
Lower Member
contribution to
weight
Profit
Greater
profits
Lower profits

Banks require a minimal investment, which all
group members should provide and this does not
have to be only money…
15
Contribution options will be evaluated by PROSUL and will be
dependent on members’ financial situations
$9,800
$980
$0
$3,000
$6,000
$9,000
$12,000
Total loan Group
contribution
Loan and group contribution
Total contribution: $ 980
12 members each contributes around $ 82
Contribution
• Money
• Labour
• Cattle
• Other
• 5 – 10% of total loan amount
• Reduce risk to banks, shows
commitment from members
Group contribution

Agenda
The opportunity – an affordable and
profitable approach to cattle fattening
Profit sharing and investment
Discussion and questions
16
Discussion and questions
Progress and next steps
Profit sharing and investment

3 groups were chosen and based in 3 districts
17
Groups selected based on potential ability and access to required
structures
• Access to irrigated land
• Land available for fodder production
• Electricity (solar energy) and water available
• Access to vet services and supplies
• Groups have existing cattle
• Group of cattle traders organised as company
• Experienced traders
• Will benefit from sugarcane tops and molasses
• Access to land and irrigation
Matchinguetchingue
(Massingir)
Cassava producers
(Inhambane)
Women’s cattle
traders
(Magude)
• Cassava producers with access to irrigated land
• Will benefit from cassava residues/peels
• Land available for fodder production
• Access to vet services and supplies

PROSUL Project Sites/Groups
18

PROSUL Project Sites/Groups
19

Progress & next steps
20
• Groups are currently under registration as private companies.
Registration will be finalized before the end of July.
• Feedlot tender released and selection will be done on
Wednesday 11th July
• Expect feed lot construction starting in 2 weeks and finalizing
by end of August
• Brachiaria seeds imported from ILRI-Kenya and duplication
will start soon.
• Soil samples were taken for analysis in Maputo. This will
provide indication on the fertility of the soil

Progress & next steps
21
• Initially 7 financial institutions were contacted to present the
project and discuss interest and potential collaboration
• Four (4) financial institutions were shortlisted for the second
round of discussions (current meeting)
• An MoU will be shared with the 4 shortlisted financial
institutions by the 20th July, asking each of them to provide
inputs and comments.
• PROSUL team will review the MoUs and finally select the one
with the conditions that best fit to the project
• By beginning of August we hope that the MoU will be signed

Agenda
The opportunity – an affordable and
profitable approach to cattle fattening
Profit sharing and investment
Discussion and questions
22
Discussion and questions
Progress and next steps
Profit sharing and investment