1. What Would it Take for Zambia’s Cattle Industry to Achieve its Potential? Sunil Sinha Prepared for the Job, Prosperity and Competitiveness Project Supported by the World Bank, African Development Bank, and DFID 1

2. Huge Potential of Cattle 2

3. Substantial Grazing Land, Good Conditions 4 times more grazing than arable land 3 agricultural zones suited to livestock If Zambia = Kenya : additional asset value of US$4.5 billion.

4. Domestic Market: Potential for Fast Growth Consumption of beef and dairy products rises fast when incomes increase. Zambians consume very little beef and dairy products. 4

5. Zambia could export more beef & Dairy products to neighbours 5 Namibia and Botswana supply beef to RSA and export to Europe. RSA is a net importer. Exports to DRC, Angola. Botswana, RSA, Tanzania, Malawi import dairy products. Beef main importers (2007) US$ ‘000 RSA23,665 Zimbabwe727 Beef main exportersUS$ ‘000 Botswana111,207 RSA10,557 Namibia38,487 Milk main importers (2007) US$ ‘000 Botswana 15,242 RSA 6,823 Angola 5,387 Tanzania 1,611 Milk main exporters (2007) US$ ‘000 RSA 2,223 Zimbabwe 885 Kenya 778

6. 6 World Beef and Dairy Trade = $50 billion+. Slow growth, Prices falling in real terms. International Markets Huge & Very Competitive

7. Cattle: Key To Reducing Rural Poverty Livestock owned by most rural households Higher proportion of household incomes than crops (c 40%). Cattle industry: 310,000 (c 25%) of households Cattle is the largest asset (US$1-1.5 billion) CattleSheepGoatsPigsPoultry Million heads 3.10.4850.7460.7049.9

8. Under Performing, Uncompetitive 8

9. 9 Small Cattle Population, Concentrated In 4 Provinces.

10. 10 Underperforming In Beef & Dairy Production is not much higher than1990, negligible exports...

11. 11 Currently, Not Competitive In Beef Source: FAOSTAT, year 2007, Zambia figure: consultants’ calculation ZambiaKenyaNamibiaRSAArgentinaBrazilUKUSA Live weight (US$/kg) 1.291.111.191.571.260.992.261.98 Dressed weight (US$/kg) 3.692.162.132.82.72.044.193.81 Competitive in live weight, not in dressed weight.

12. 12 Nor In Dairy Farm Gate Producer’s Price, US$/Litre Source: FAOSTAT, Heifer International, Zambia figure: consultants’ calculation Cost of raw milk is high because of scarcity, still importing powder to reconstitute as milk. 20082009 Zambia0.680.6 South Africa0.4 Kenya0.20.3

13. Why Not Fulfilling Its Potential?

14. Small Market, But Now Growing  Incomes low outside formal employment  Prices: higher than neighbours,  10% of food expenditure  But market for beef now growing 5%-7%,  Dairy c. 10% p.a. But constraint in Lusaka.  Driven by: higher urban incomes, urbanisation changing lifestyles, changing food consumption patterns 14

15. 3 Systems: Motives, Opportunities & Constraints Cattle Population (000) 15 Farmer TypeTraditional EmergentCommercial Calving rate30%-50% in-btn70%-80% Calving mortality 30%-40% in-btn1%-2% Adult deaths5%-10% LowerLowest Off-take rates 8%-9% 10%-15%17%-18% Live Weight 200-250250300 Milk yields1-2 ltrs8-10 ltrs17-23 ltrs CharacteristicLow growthDynamic