Why do you import beef and which cuts are most popular?
We identified beef imports as a business opportunity, and import whole primal cuts of boxed, free-range, grass-fed beef – mostly chilled, boneless and untrimmed – from the Botswana Meat Commission (BMC). We specialise in beef for the upper-echelon of consumers, so we buy something quite special. The grade quality can compete with South African A2/A3 meat. But grade aside, the beef supplied by BMC is grass-fed, free-range and oestrogen-free.
Taking these criteria into consideration, I think our Botswana beef is superior to the average local beef products. Of course there are exceptions when it comes to SA beef. For example, some of the beef coming out of KwaZulu-Natal, among others, is exceptionally good. The only true litmus test, as far as I’m concerned, is whether it flies off the shelves in Illovo in Johannesburg and Constantia in Cape Town at, say, R220/kg. Wealthy customers are very discerning and know more about beef than I ever will. You know that you have a good product when ‘elite’ butcheries in South Africa keep coming back.
From which countries do South African meat importers mainly source their beef?
SA meat industry statistics are highly contradictory. I can cite five ‘eminent’ authorities, who contradict each other to such an extent that it makes an accurate assessment a waste of time. For our business’s purposes, not necessarily trading purposes, we require quite a lot of statistics, and I’ve learned to stick to the Bureau for Food and Agricultural Policy (BFAP), academic publications and a 13-year-old scientific research publication.
Do you believe that meat imports harm the local beef producers’ industry?
This argument is nuanced. But, in simple terms, South Africa has to import beef because it consumes more than it produces. On top of that, South Africa exports some of what is produced. Whether it’s harmful – if you are talking about undermining local producers’ cost-based and price-based viability – is a moot point. You can’t ask the last 10 000 consumers in the queue to go without beef until such time as we produce more beef and prohibit exports.
Look at it this way: I don’t see how anyone can believe that it’s the 13 000t, or 32 000t, or even 50 000t (depending on whose statistics you believe) annual beef imports that is single-handedly messing up a more than R14 billion, or approximately 640 000t red meat per annum industry. Even if it were given away for free, the current volume of imports could not do the level of damage being attributed to it.
Do you liaise with the Red Meat Producers’ Organisation in any way?
Permit me to broaden the question to ‘the various red meat industry bodies’. Some have been helpful, whereas others have been reticent. I can understand this – there’s a lot of sentiment involved. But one organisation in particular, the Association of Meat Importers and Exporters (Amie), has been especially helpful.
Our company is relatively young and we haven’t been able to splurge on everything we would have liked to, such as joining all six industry bodies whose membership could be exploited to our marketing and research advantage. However, we hope to get much closer to Amie and I trust that will be very beneficial to us.
Much is often made of the damaging effect of irregular red meat imports, particularly beef, on the red meat industry as a whole. What is your stance?
Do irregular imports pertain to the importing of meat with falsified documents and/or labelling, or avoiding excise duties fraudulently? Of course. But even some regularly approved imports are questionable. Given the costs of producing beef to EU standards, we’d be thrilled if someone did something about dicey imports. It stands to reason that the impact on the relatively small import sector is much greater than the impact on the relatively large overall domestic beef industry.
The only realistic suggestion is for the SA red meat industry to pay for private inspectors to supplement customs and veterinary services, similar to the local insurance company that pays for pointsmen to stand in for metro police at traffic lights that do not work. Having seen the thorough testing used by Botswana abattoirs to quickly and easily test meat, I believe that rigorous inspections of meat coming into SA are possible. A trained eye will also help to identify the different meat classes in a two-second glance.
But would the SA red meat industry as a whole be willing to pay for private inspectors at, say, 20 nominated ports of entry? I only mention it because the controls on meat imports are not going to improve overnight, and no amount of complaining will help. Therefore, another way has to be found to enforce the law to protect SA consumers and farmers. Meat importers will be the first to cheer because we stand to benefit most.
What are the legal requirements for the importation of beef from our neighbouring countries?
BMC is very rigorous about South Africa’s regulations. In fact, we have a minor challenge at the moment because BMC’s interpretation of a certain regulation is more stringent than our own understanding of it. Foot-and-mouth disease (FMD) is another example of BMC’s rigour: they check the meat before procurement, before slaughter, after slaughter, and again 48 hours later. This even applies to meat procured from vaccinated animals in zones that have had no cases of FMD for three years and are buffered from red zones. Here, I don’t even refer to their insistence on the proper paperwork. Nobody can complain about how BMC, for one, co-operates with South Africa’s legal requirements.
In your opinion, does government enforce these legal requirements strictly enough?
Every senior official in the Department of Agriculture, Forestry and Fisheries’ veterinary service we have dealt with has been diligent. Whether that reflects the right ratio of veterinary service and customs staff to workload, the correct level/intensity of inspections, or whether it reflects the right location of the staff (at borders, ports and so forth), are all different matters. I honestly can’t comment in general because I deal with a limited number of people at one specific point of entry and only on an occasional basis. I’ve heard rumours about lax enforcement of the legal requirements, but have never experienced it.
What are the legal requirements for the labelling of imported beef products?
We trade in BMC boxed beef. So, you effectively talk about EU-conforming grading and labelling regulations. BMC grading and labelling are very strict. I haven’t experienced anything similar elsewhere. But that is to be expected from BMC given the fact that countries such as Germany, Italy, and Norway constitute their most important markets. I believe BMC’s labelling requirements are possibly the most rigorous of all South Africa’s beef import markets.
How are South African consumers protected against sub-standard imported beef products?
Anyone could bring in 20t of C-grade beef, re-pack and re-label it, and sell it as A-grade at a high gross profit margin. Or an unscrupulous foreign abattoir could mark the meat as something else and then someone could import it.
But, in theory, that could be done to SA beef, too. Consumer protection opens a Pandora’s box, with random inspections, licences, adequate penalties, adequate state resources for inspections, and so on.
Which cuts are predominantly imported?
Broadly speaking, I couldn’t comment. We compete in a limited high-LSM niche with relatively few competitors, and I don’t know much about what other importers are bringing in for the mid-range and low-LSM consumers. We mostly deal in hind-quarter cuts. The kind of people in our market segment who differentiate in terms of free-range and grass-fed are more inclined to rump than brisket.
We mostly sell to top-end supermarkets, butcheries and a few restaurants. Our customers, in turn, retail to the kind of customers who don’t mind paying a premium for grass-fed, free-range hindquarter cuts.
Contact Simon Roche at [email protected] or 061 489 5775.
This article was originally published in the 21 February 2014 issue of Farmer’s Weekly.