SA Meat and the Global Market .

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2. Structure of presentation. Universal overviewPrice patterns in SAConsumption patterns in SAPointersConclusions. 3. World dairy cattle makers. SA ave: 630 000 t. Source: FAPRI, 2004. 4. World supply and interest for hamburger and veal. Source: OECD and FAO secretariats. 5. World meat trades. Source: OECD, 2004.
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SA Meat and the Global Market André Jooste Senior Manager: Market and Economic Research Center, National Agricultural Marketing Council 13 March 2008

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Structure of presentation International review Price inclines in SA Consumption drifts in SA Pointers Conclusions

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World dairy cattle makers SA ave: 630 000 t Source: FAPRI, 2004

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World free market activity for hamburger and veal Source: OECD and FAO secretariats

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World hamburger sends out Source: OECD, 2004

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Imports projections (hamburger and veal) Source: FAPRI 2006

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World exchange projections (meat) Source: OECD and FAO secretariats

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126 393 116 195 134 98 92 33 Vloei in \'000 t cwe 25 50 100 150 200 300-400 > 400 Based on GIRA figures World hamburger exchange streams, EU-12, 1990 Source: Spanghero, 2002

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117 313 172 597 205 60 49 73 64 Vloei in \'000 t cwe 25 50 100 150 200 300-400 > 400 Based on GIRA figures World hamburger exchange streams , EU-15, 1995 Source: Spanghero, 2002

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279 155 112 317 25 60 39 35 29 48 Vloei in \'000 t cwe 25 50 100 150 200 300-400 > 400 Based on GIRA figures World meat exchange streams, EU-15, 2000 Source: Spanghero, 2002

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World hamburger exchange streams, AU/NZ - 2005

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World hamburger exchange streams, EU and North America - 2005

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World meat exchange streams, S.Am - 2005

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World meat exchange flows,2005 (GMC)

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Decline Per capita utilization 2006 versus 2016 Source: FAPRI, 2007

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Results - Beef completing Purchase costs (US$ per 100 kg live weight)

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Results - Beef completing Short and medium term productivity (US$ per 100 kg body weight)

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Liberalization in 1995 Deregulation in 1997 - Beef industry as of now began in 1992 Background: Evolution of the business The real move time frames: Opportunity driven (1970s) Production driven (1980s) Cost driven (1990s) Consumer driven (2000 - ) IS IT GOOD ENOUGH TO BE CONSUMER ORIENTATED??

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Price patterns Source: AMT

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Price patterns – concentrate on meat Source: DoA, 2008

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Weaner and A2/A3 body costs Source: AMT, 2007

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Increased instability Period of critical additions and misfortunes More or less in adjust Price patterns Source: DoA

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Producer partake in the retail cost of rear end Source: STATSSA & claim counts

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Producer partake in the retail cost of sirloin Source: STATSSA & possess computations

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Producer partake in the retail cost of topside Source: STATSSA & possess figurings

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Producer partake in the retail cost of brisket Source: STATSSA & possess estimations

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Producer partake in the retail cost of toss Source: STATSSA & claim computations

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Consumption patterns Source: DoA

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Consumption patterns (… proceed with) Source: DoA

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Consumption patterns (… proceed with) Source: DoA

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Consumption patterns (… proceed with) Source: DoA

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Short term patterns Beef costs are high and will most likely stay firm Aren\'t we fortunate?? Utilization on the up, i.e. add up to and per capita Alternative situation: Prices low Consumption on verifiable descending pattern (before 2000) We know the final product!!

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Let\'s take a gander at this from another edge Red meat industry understood that much should be done to change the picture of red meat R&D on purchaser conduct Promotion Competitions However, a more critical look appears: Total per capita red meat utilization more inclined to be 23.96kg Beef down to 15.73kg, Pork down to 3.27kg, Sheep down to 3kg.  Turn around in large scale monetary conditions (Econ development) Mainstreaming financial movement of blacks ("dark precious stones")

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Composition of nourishment and non-mixed drinks Source: IES 1995, IES 2000, IES 2005/06

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Time to reexamine our introduction?? In spite of the fact that the business changed with positive outcomes one can securely hypothesize that being purchaser orientated (in principle) is not adequate It misses the mark concerning global advancements in agro-evolved ways of life.

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Some pointers : Factors deciding purchasing choices Factors deciding hamburger purchasing choices are changing Economic versus non financial components This is the pattern universally

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Desirable qualities of meat USA (1=extremely attractive; 5 = not in any manner alluring) Sitz, Calkins, Umberger, Feuz - U of Neb., 2004

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Desirable attributes of meat Japan 89 Safe 81 72 70 Purchase with certainty HGP/Chemical free Delicious 59 Juicy 52 47 Reasonable cost 46 Availability Tender 41 Non greasy 39 Nutritional 0 20 40 60 80 100 120 % of shoppers overviewed Source: MLA

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Importance of item traits per Cluster - (Free State Province) Source: Botha, F., Taljaard, P., Jooste, A. & Pelser, A. (2007). UFS.

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Some pointers : Other variables More complex buyers and connecting it with item improvement E.g. Checkoff program in US – 500 new items somewhere around 03 and 04 In SA most likely not even a 100 since 2003 to date Lack of globally worthy traceability framework Problem/affect exacerbated on the off chance that one considers assurances to conform to expanding and more stringent principles set at the retail level , and also to send out.

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Some pointers : Other components Is our evaluating framework still fitting? Source: MLA

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Some pointers : Other variables Transparent, exact and opportune red meat data framework is fundamentally non-existent. The outcome is a long way from ideal chain sequencing putting weight on chain administration and connections . Dualistic nature of meat industry Growing casual market Policing of directions and wellbeing norms extremely troublesome Puts the entire business at danger since low quality item can now achieve the market undetected. Extremely hard to oversee and control infections

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Let me rehash: No/almost no data streams Traceability lacking Slackness in the business to make uniqueness Problems with industry structure Most eminent is the dualistic way of the business This when: Productivity is expanding Improved innovation (butchering and preparing) Continued interest in "uniqueness" Traceability Information frameworks

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Therefore: An esteem chain introduction (in reasonable terms) is fundamental, e.g. Connections Info frameworks Some organizations/chain players are reacting, yet general industry reaction lacking Challenge for composed structures in red meat industry to react and look after force

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Source Roduner (2005)

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Some esteem chain influencers

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China – the developing tiger ("the vacuum") Has a fifth of the total populace and GDP gorwth at 9-10% Food is one of the biggest spending things for family units 38% for urban families half for country families The quantity of rustic family units in the working class 7.6 million in 1995 42 million in 2005 This will develop to 199 million in 2015 (McKinsey Quarterly)

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China – the developing tiger As expectations for everyday comforts increment they are curring back on staple sustenances, for example, rice and wheat. Utilization of dairy, fish, wine and handled sustenance on the expansion. Sustenance imports in the district of US$25 billion 4 th biggest on the planet Do purchase nourishment, as well as need sheltered and complex nourishment.

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Brazil – the sustenance crate SECEX, 2005

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NEW AGRICULTUR AL FRONTIER S IN BRAZIL Belém Itaqui Nova Fronteira na Produção de Grãos World\'s Distribution of land: Itacoatiara Santarém WORLD BRAZIL Maceió Million of ha Million of ha Aratu BOLÍVIA Vitória PARAGUAI Santos Paranaguá ARGENTINA Imbituba Rosário Porto Alegre URUGUAI Rio Grande Source: FAO Waterway s Railway s New Agricultural Frontier s Ports Brazil – the nourishment bushel

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Brasilië – kick the bucket voedselmandtjie

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Brazil – the sustenance wicker container Sources: Agrianual, Pensa, MAPA, CONAB, IBGE * 2003 Crop

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Other influencers Biofuels industry Oil costs Consumer certainty Infrastructure (water, power, streets) Exchange rate and so forth

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Concluding comments From a South African and Southern African point of view this industry crucially imperative Sustainability (the triple botton line) Where is the speedy wins with long run impacts Proper bolster administrations Proper data benefit Relationship building and collaboration Understand the financial aspects and environment as it changes

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"It is not the most grounded that survives, but rather the most versatile " . Much obliged to you

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