Rudles farming enterprise: A case study in cooperation

The Limpopo agriculture department brought in two small-scale chicken farmers to take over a failed land reform project.

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Although the farmers had only met a few times before, they work very well together, producing 42 000 chickens every cycle. Peter Mashala visited their farm outside Mokopane. In 2008, the limpopo agriculture department contacted Lesiba Sebajane (41) and Rudzani Sadiki (28) to take over a failed 408ha broiler farm in Mokopane. But the two only lease the chicken house as the farm still belongs to the Lafata Agricultural Trust, formed by the previous beneficiaries.

Although they hardly knew each other when they partnered, they’re now contract growers for Mike’s Chickens in Polokwane, producing about 42 000 birds per 38-day production cycle. They trade under the name Rudles Farming Enterprise, a combination of their names. In June 2008, the department sent the pair for a month of training at the Bushvalley farm in Tzaneen.

After training, the two moved onto the farm. “The first two months we spent looking for a market. We finally found one as contract growers for Mike’s Chickens in Polokwane,” says Rudzani. Operations were delayed and they missed a cycle in December, starting their first cycle in February 2009.

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Life before the enterprise
Lesiba and Rudzani had produced broilers on a small scale in different parts of Limpopo. Rudzani, the CEO of the enterprise, was producing about 8 000 chickens per cycle in the small village of Matsa outside Louis Trichardt. He holds a diploma in agricultural management from UNISA.

Rudzani applied to the Limpopo agriculture department for help to grow his business. “The department told me about an abandoned chicken farm in Mokopane,” he recalls. But the farm could only be given to him and a partner, who the department had already identified.

Lesiba, Rudles’s chief operational officer, is from Bavaria village outside Mokopane. He holds a diploma in animal production technology from the then-Pretoria Technikon. After graduating, Lesiba got a job at Johan Scholes Farming in Krugersdorp near Johannesburg. “After working there for a while, I decided I wanted to start my own business,” Lesiba says. He started his own small-scale broiler operation back home. “I didn’t have enough land, so I started small.”

He had just over 100 chickens, and negotiated with his community leaders for more land to grow his business. He also applied for assistance from the Limpopo agriculture department. When permission to use community land was granted, the opportunity the Limpopo agriculture department offered him forced him to abandon his solo plans and join Rudzani on the Rudles Farming project.

An unlikely pair, working together
The two speak highly of each other. Lesiba says that unlike many other young men he knows, Rudzani is a pleasure to work with, with the right attitude and experience. “He’s a hard-working person and I foresee a good future with him as a partner,” says Lesiba. Rudzani is equally positive about Lesiba, calling him hard working and creative. “I have a good working relationship with him, and the age gap isn’t a problem,” he says.

Before the department handed over the farm, they had to submit a convincing business plan. Putting their experience to good use, the partners drew up a business plan that earned them the farm. It came with a 1 800m² Tomcan broiler house with a capacity of 42 000 birds, together with other equipment valued at R3,2 million. They have produced about 500 000 chickens since starting in February 2009. “In December we will complete our 13th cycle,” Rudzani says.

Lesiba says that landing the contract wasn’t easy. The contract stipulated that they needed to have a security fence, maintain a good access road to the chickenhouse and take out insurance for it. “We also had to have a medication tank on the premises for disease control and vaccination.”

Mike’s Chickens supplies day-old chicks, feed, catching staff and transport to Rudles. Rudles only paid for their operational costs such as labour, gas for the heaters, electricity, medication, fuel, cleaning material and insurance. “We save where we can, but we don’t take short cuts to cut costs that would compromise the birds’ quality,” Lesiba says.

Changing feed
To reduce their feed consumption, Rudles changed their bird breed from Ross 788 to Hubbard. “The Ross 788 has a very high feed conversion ratio, about 1,84%, which means more feed,” Lesiba says. Because the Hubbard drinks more water, it requires less feed than the Ross, but still has a high feed conversion of about 1,73%.

The mortality rate in Ross was also high. “We experienced up to 6% mortality rate in Ross compared to 3% in Hubbard,” Rudzani explains. “We use five phases of broiler feed – pre-starter crumbs, starter crumbs, grower crumbs and pellets, finisher pellets, and post-finisher pellets.”

Feed consumption of the two breeds is also different. “We used to use at least 150t of feed per cycle with the Ross 788, compared to 120t we currently use with the Hubbard,” Rudzani says. The day-old chicks arrive at the farm weighing around 4,2g, and fully grown chickens leave the farm after 38 days at 2kg.

Rudzani says farmers should work hard to get into the market as South Africa has a shortage of chicken. “Because of this, the country has to rely on imported chicken, mainly from Brazil.”

Moving up the value chain
Lesiba and Rudzani also run a centre for skills development to train aspiring poultry farmers. “We try to plough back the knowledge we accumulate to those who need it,” Rudzani says. Although they offer training to other farmers, they feel there’s no such thing as knowing it all. The two still regularly attend workshops. The partners plan to move up the value chain and open their own chicken abattoir with other black poultry producers.

“We’ve been talking with the department of agriculture, and the process to build an abattoir is underway,” says Lesiba. The abattoir’s shares will be distributed among local poultry farmers. “Building an abattoir and distributing shares isn’t a done deal yet,” Lesiba says. They also want to stop contract growing and become independent growers.

“It will give us better returns,” Lesiba says. “We’ve discussed it with Mike’s Chickens and they don’t have a problem.” Rudles has also applied for funding through the National Emergent Red Meat Producer’s Organisation livestock financing scheme.