…Okahandja abattoir forced to remain shut
By Hilary Mare
CHIEF financial officer at Meat Corporation of Namibia (Meatco) Ingo Schneider has expressed concern about the funding position of Government further lamenting that the current negative economic outlook is expected to have a further negative impact on both consumers and the corporation.
In trying to offset the possible market lapse, Schneider said that the current situation vindicates the approach taken by Meatco to export beef to markets not directly affected and in turn earning Namibia much need foreign currency.
“We at Meatco believe that Namibia’s small, open economy is highly exposed to events on the world stage and any material development is expected to have an impact on how our economy performs and inter alia how Meatco performs. Key items to watch for are ongoing uncertainties in respect of the performance of world economy especially low growth prospects in our key off take markets. If the situation deteriorates more than we anticipate, it would affect Namibia’s overall growth but also the prices we receive for our product.
“On the local front, Meatco is concerned about the funding position of Government, despite the fact that large outstanding VAT claim against the Receiver of Revenue have been settled with Meatco having received a material payment over year end effectively bringing them back to a normal working capital cycle in terms of our outstanding VAT. Overall the current negative economic outlook is expected to have a further negative impact on consumer spend and this scenario seems to vindicate the approach taken by Meatco to export beef to markets not directly affected and in turn earning Namibia much need foreign currency.
“Meatco’s financial position can be considered healthy at present, with the only concerns being the available limited cattle numbers coming out of consecutive droughts. The impact being that despite Meatco offering record prices to lure farmers to deliver cattle the committed supply has been limited with the fear of little slaughter cattle remaining as farmers are beginning to restock the national herd. The expectation is that slaughter volumes for the first two quarters of the year will be low and Meatco will have to greatly rely on the backward integration models to maintain slaughter operations,” explained Schneider.
With the limited inflow into dams till date remaining a major concern, Schneider further stated that until there is a lesser risk of water supply; Meatco will continue to operate under the current set constraints.
“Due to the above mentioned, low slaughter volumes, limited water as well as concerns about affluent treatment in Okahandja, Meatco will be forced to keep Okahandja closed which will have a short term impact on the financial situation. We are committed to accommodating staff elsewhere, with additional plans on how to best to utilise the Okahandja factory.
“In these trying times, Meatco is confident that we are well funded and have sufficient reserves to meet our commitment while supporting farmers and Namibia in large during difficult times, just as we have done in the past,” he said.
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