Successfully reported this slideshow.
We use your LinkedIn profile and activity data to personalize ads and to show you more relevant ads. You can change your ad preferences anytime.

An affordable, accessible and profitable approach to cattle fattening in Mozambique

98 views

Published on

Presented by Nadhem Mtimet, ILRI, in Maputa, Mozambique, July 2018

Published in: Science
  • Be the first to comment

An affordable, accessible and profitable approach to cattle fattening in Mozambique

  1. 1. Nadhem Mtimet, ILRI Maputo, July 2018
  2. 2. 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 ?
  3. 3. 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
  4. 4. 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.
  5. 5. 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
  6. 6. 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?
  7. 7. 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?
  8. 8. …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
  9. 9. …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
  10. 10. 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
  11. 11. Swazi Beef Project Feedlot 11
  12. 12. 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
  13. 13. 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
  14. 14. …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
  15. 15. 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
  16. 16. 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
  17. 17. 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
  18. 18. PROSUL Project Sites/Groups 18
  19. 19. PROSUL Project Sites/Groups 19
  20. 20. 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
  21. 21. 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
  22. 22. 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

×