A recent outbreak of foot-and-mouth disease (FMD) in Namibia has led to the shutdown of Savanna Beef Processors, an export abattoir, putting 240 workers at risk of job uncertainty. The outbreak was detected in the FMD-free zone on 23 September, resulting in the suspension of key export markets. As a result, the company's chairperson, Mecki Schneider, informed shareholders and members of the Beef Value Chain Forum that all employees working on the slaughtering, cooling, deboning, and packing floors had been placed on leave.
The shutdown has brought operations to a complete standstill, with management expected to decide on employment arrangements for November and December this week. Prior to the outbreak, Savanna had reached its maximum daily production capacity of 250 head of cattle and had exported approximately 100 containers of beef to niche markets in the United Kingdom, the European Union, and Norway. The company's management is working to find alternative markets and prepare the facility for a possible limited restart.
A skeleton staff remains on site to maintain equipment and operate the remaining cooling facilities, while beef stored in chillers and freezers is being sold locally. Management expects maintenance and improvements, including issues identified by the Directorate of Veterinary Services, to be largely completed by mid-November. This would allow for a limited restart of slaughtering towards the end of November and, if feasible, continue through December.
However, the company has not indicated how many of the 240 workers could return if operations resume on a reduced scale, or whether employees will receive full pay while on leave. The shutdown also threatens to affect cattle producers who had secured supply arrangements with Savanna, with the company having booked cattle supplies running into the thousands for the third quarter.
The employment uncertainty comes as Savanna works to restore Namibia's veterinary status through a renewed application to the World Organisation for Animal Health. The Beef Value Chain Forum's steering committee has approved N$500 000 to engage an international expert to assist with the process, an initiative intended to benefit all export abattoirs. The company is also seeking alternative markets, although Schneider cautions that negotiations are complicated by differences in countries' veterinary requirements.
Schneider warns that producers should prepare for lower prices while the industry waits for market access to be restored. He adds that "lower market prices are expected in the near term until access to the EU and UK markets is restored." Savanna is currently operating in survival mode, with expenditure aligned with its financial circumstances.
The company is supporting efforts to restore Namibia's veterinary status, and management will provide the first indication of how the shutdown will affect its workforce. The shutdown has significant implications for the industry, with the company's management working to mitigate the effects of the outbreak and restore operations as soon as possible.
Key points
- 240 workers at Savanna Beef Processors face job uncertainty due to the FMD outbreak
- The shutdown has brought operations to a complete standstill, with management working to find alternative markets
- The company is seeking to restore Namibia's veterinary status through a renewed application to the World Organisation for Animal Health
