South African ostrich slaughter will fall to 200,000 birds in 2007 – from about 250,000 this year – and will decline further in 2008, in the view of Saag Jonker Group CEO Saag Jonker, the country’s biggest ostrich farmer. ‘The ostrich farming industry is shrinking’, he said. ‘Some of the best farmers, like Pieter Coetzee, Casper Wolff and Johan Senekal, have left the industry over the past two or three years and we are also seriously reconsidering our position. I’m emotionally wedded to ostrich farming but my sons look at it from a business point of view and they’re questioning whether it’s worth continuing.’

He said his group had survived because they had ‘direct access to the leather market’ but following the sale of that division to Klein Karoo in 2003, they had become dependent on the meat business. Jonker said the most negative factor for ostrich farmers currently was the ban on the export of ostrich meat, but the overall drop in the value of the ostrich industry had allowed processors – abattoirs and tanneries – to pressurise producers in various ways.

He said a farmer selling a 90 kg bird with a carcase weight of 43 kg ‘probably receives an average of R700 (US$98.42) for the skin and R65 (US$ 9.13) for the feathers. If the meat is destined for the local market, he gets about R600, less R165 for slaughtering, for a net price of R435, giving a total of R1,200 – yet the cost of producing that bird is at least R1,500.’

Meat exports were the difference between profit and loss, he said. Where the price to the farmer for meat sold locally was around R14/kg, meat for export fetched R21/kg and over. ‘Klein Karoo is doing a good job of popularising ostrich meat to South African consumers’, he said, ‘but the fact is this market will never be able to absorb all the meat, and we’re sitting on a huge stockpile.’

He said raw skins fetched between R650 for fourth and fifth grades and R900 for first grades, ‘but where previously the proportion of grades was 60:30:10 for firsts, seconds and thirds, it’s not uncommon to find the assortment now is only 25% first grades, and there are many fourth and fifth grades, where those were previously almost unknown – but it’s not the quality of the skins that’s changed, it’s the sorting, where producers are being excluded from the process.’

Acknowledging that tanneries were also under price pressure from their customers, he said: ‘Because of different end uses and different cutting values, a skin which might be only considered third grade for handbag manufacturing could be classified first grade for boot manufacturers, but processors don’t want to see it that way.’

While the industry knew that ostrich leather would have to wait for the fashion cycle to turn its way, the demand for ostrich meat remained, he said. The problem was how to deal with Avian Influenza (AI).

Although the source of AI in South Africa has not been definitively established, Jonker said most farmers believed it came from wild birds. ‘There’s no way we can farm all our birds under cover, so the only long-term solution is inoculation. But the Department of Agriculture won’t allow us to inoculate our birds against AI because, as I understand it, they cannot tell with their testing whether the antibodies in a bird are as a result of the vaccine or because they’ve been exposed to AI. Yet there are methods of testing which can differentiate. It’s a matter of having the clout and the will to argue that case, and the producers don’t seem to have that at the moment.

‘No-one seems to remember that the ostrich producing cycle is about 30 months. The last slaughter of birds produced this year will be in mid-2008. But then there will be a shortage, and it won’t be something that will be easy to fix.’