South African agricultural economist, Wandile Sihlobo has said that South Africa’s beef exports to Saudi Arabia are crucial to industry growth.
He said following the announcement that Saudi Arabia will to import meat from South Africa following the end of an import ban, everything is now in place for the kingdom to import beef from South Africa.
This comes after several engagements between the South African government and private sector with Saudi Arabian authorities to unlock this market.
“Industry organisations such as Red Meat Industry Services and private sector stakeholders such as Karan Beef, Sparta Beef and Beefmaster, deserve much credit for this uplifting development on the beef export front,” he said
Saudi Arabia has not featured prominently in SA’s beef export markets in the past, with only small volumes last exported in the early 2000s.
Sihlobo said renewed access to the Saudi market is critical to SA’s ambition to expand beef exports, as the Saudi beef market is sizeable.
He said about 62% of Saudi beef imports are frozen products, while the rest are chilled or fresh meat. Leading suppliers to Saudi Arabia include Brazil, Australia, Pakistan, the US, New Zealand and Canada.
Beyond beef, the Saudi meat market is large and this means over time, as South Africa increases its production in other meat value chains, Saudi Arabia could remain a strategic country for growing exports.
Sihlobo said one of the most significant challenges the beef industry has faced is the rise in feed prices since 2020, especially maize and soybeans.
The rise in animal feed prices coincided with a worsening of financial strain on consumers due to the damaging effects of the Covid-19 pandemic.
“We thus saw a decline in demand for red meat products as consumers opted for relatively cheaper forms of protein.” In addition, the spread of foot-and-mouth disease to six of South Africa nine provinces for the first time in history proved a major hurdle for the industry. This brought temporary bans in specific export markets, extending to auctions and livestock movement.
“Fortunately, feed prices have now softened. This is in response to large domestic maize and soybean harvests and the easing of global grain prices.”
Despite the foot-and-mouth disease challenge, SA beef exports did not collapse. Some markets remained open, though with strict controls. This is evident in SA’s beef exports for 2022, which amounted to 28 422 tonnes (down 12% from 2021), according to data from Trade Map.
