https://www.dailymaverick.co.z...e-brink-of-collapse/



South African game-farming industry on the ‘brink of collapse’

By Ed Stoddard• 11 May 2020



South Africa’s experiment in ‘wildlife privatisation’ is under threat from the Covid-19 pandemic and the lockdown measures to contain it. The once-thriving game-farming industry is in serious trouble because its main sources of revenue — hunting, game viewing and sales — have been under lockdown. It is an economic meltdown that could also create an animal welfare crisis.

Commercial farmers in South Africa have for the most part been able to get on with their business under the pandemic-triggered lockdowns — feeding the nation is clearly an essential service.

But one sub-sector of South African agriculture has seen almost all of its revenue evaporate in the face of the pandemic. The game-farming industry is on the “brink of collapse,” according to a presentation by Wildlife Ranching South Africa (WRSA), the main body that represents more than 1,500 ranchers in the sector.

“It is clear that the South African wildlife industry is on the brink of collapse due to the impact of Covid-19 on the industry and unless mitigation measures are introduced urgently to allow for live game trade, the production and distribution of game meat and the introduction of incremental local hunting and tourism activities, most product owners in the wildlife industry in South Africa will not survive the impacts of Covid-19,” the presentation says.


“Despite wildlife management being stipulated in the National Disaster Management Regulations as an essential activity, the lockdown resulted in severe negative effects for the South African private wildlife ranching industry, which included not only the international hunting and tourism market, but also the domestic hunting and tourism market, live game trade, game meat sales and other related activities.”

This gels with feedback to Business Maverick from several ranchers involved in the sector, which has three main sources of revenue — hunting, game viewing and sales. This trifecta of income has dried up like a puddle in the Kalahari.

WRSA did a survey of wildlife ranchers and 601 responded. It found that there was an 86% decline in visits to such operations by game-viewing tourists and hunters in March and April — a virtual wipeout. Estimated financial losses to the sector for 2020 from cancellations was put at R3.8-billion, while that for new bookings to the end of 2020 was put at R3.1-billion. Live game sales are predicted to lose close to R1.7-billion in 2020, while meat sale losses have been put at R640-million. So total losses for the year are estimated at more than R9-billion.

And more than half of the people employed in the sector are expected to lose their jobs or suffer reduced wages.

“Respondents indicated an average staff complement as at the end of February 2020 of 15 staff members per game farm. These figures do not include the additional part-time employees during hunting season, who basically all will have no income if no hunting takes place during the year,” the WRSA survey found. With 601 respondents that would be just over 9,000 jobs.

Most of the survey respondents also expect to see an increase in environmental crimes such as poaching, which is hardly a surprise in the face of rising levels of rural poverty and hunger. Animal welfare organisations may applaud the sharp decline in sport hunting — no Texas oilmen posing with dead rhinos! No American dentists taking down lions with human names like Cecil!

But the economic crisis also heralds an unfolding animal welfare crisis. Poaching will be part of that, but there is also the question of what will happen to animals on game farms that go bust. Around half of South Africa’s rhino population is now estimated to be in private hands, and many of those animals could be at risk if the businesses that support them collapse. In the absence of auctions, current game prices are not clear, but one would expect the bottom to fall out of the market — that is certainly the perception among game farmers whom Business Maverick has spoken to. Game farm prices may also sink along with general property values, potentially adding to the mounting toll of bad debt held by banks.


Hunting, of course, is an emotive issue that often finds itself in the firing line. There are critics who question the economic contribution of hunting to South Africa’s economy. What is reasonably clear is that its contribution is not insignificant — a North West University study estimated it to be worth R11.6-billion in 2018, accounting for domestic hunters alone.

The same can be said of the game-viewing or photographic-safari sector. Both no doubt also offer entrepreneurial opportunities for previously disadvantaged communities. What is lost in the fog of the debate is that many (though not all) jobs in both sectors are often seasonal or involve poorly paid and semi-skilled work such as domestic labour. Many of the people employed are not well off to begin with, and they can often have extended family networks which translate into several dependants. A top-up in social grants is hardly going to compensate for the lost wages in low-income rural households.



Estimated financial losses to the sector for 2020 from cancellations was put at R3.8-billion, while that for new bookings to the end of 2020 was put at R3.1-billion. Live game sales are predicted to lose close to R1.7-billion in 2020, while meat sale losses have been put at R640-million. So total losses for the year are estimated at more than R9-billion.


Some game farmers will clearly weather the storm. There are wildlife ranchers with diversified business models who also produce crops or raise livestock, so their operations will still generate revenue and they can call on the bank if the need arises. And some don’t even need the money.

South Africa’s most prominent game farmer happens to be President Cyril Ramaphosa — although he lacks its ornery temperament, his nickname is “The Buffalo” — and one would expect he will not be forced to sell the ranch to pay his bills. Indeed, there is more than one CEO or tycoon out there who owns a game farm as a weekend hobby where they can escape the madding crowd by jumping in a small plane and landing shortly thereafter on a remote airstrip.

This highlights a wider problem facing the industry, which according to WRSA has “transformed more than 20.5 million hectares of marginal agricultural land into thriving game ranches.” This is in many ways a conservation success story and has been part of a wider movement now dubbed “rewilding” whereby land formerly used for cattle or put to the plough has once again become the range of wild animals including megafauna such as rhino, elephant and buffalo.


Yet calling it an “essential service” is debatable and the industry almost exclusively caters to the affluent. This is not meant as a criticism — it is simply a statement of fact. The mostly white upper and middle classes in South Africa value wildlife and ultimately foot the bill for the upkeep, protection and preservation of such fauna, which in many cases has effectively been privatised.

From a free-market perspective, there is nothing wrong with this state of affairs and its potential conservation spin-offs. If someone values wildlife, they can pay for it. The challenge now is that this bill is going to become a lot bigger, for wildlife can hardly compete for resources or sympathy in a developing economy with glaring income disparities in the face of the escalating and pressing social needs wrought by the pandemic. BM

Those R$11 million dollar Buff will soon be selling for R$11 bucks a kilo.

A lot of okes will go back to farming cattle.

Not surprising to me at all. It is consistent with the info I am getting from friends in the industry.

I don't know what the solution is. Wish I did.

As usual, the strong will survive.......the leveraged wont.....


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There are many ranches in South Africa and as suspect some are always in financial hardship, no different than in the USA. Some ranchers/farmers are always in trouble for one reason or another.

Talking to a few in Africa this will separate the good operators from the not so good operators. They do feel that when this opens up that there will many current operators who will no longer be in business.

The operators that are operating on a shoe string will be on the out looking in. They believe that pricing will hold when the industry opens up to allow tourist hunting. This is from the basic game lodges that provide photo opportunities and game drive to the hunting sector.

One thing that we did agree on is that there will be some fantastic opportunities for tourist hunters. The chance that you will be going after some trophy animals. They did indicate that there will be some culling of game animals to make sure that there is forage for the animals that are left.

also their will be some in country hunters doing their take in the near future, when that segment opens up.

Jim I agree. Some natural selection will be good for the industry.

I received a very slick email from a hunting operator based in RSA that claimed to have more land than the country of Portugal. They were coming to me to ask for a bailout, even providing a link where I could donate!

Well I only have 100 acres so I thought perhaps this was a bit rich.

When I lost my rear end in the stock market, I didn't ask anyone for a donation. When I lost my job, I dusted myself off and got on with it. When I was diagnosed with cancer, ditto. I paid my bills, and they were exhorbitant. When I got into a legal mess, I paid my lawyer without any crowd funding. When COVID hit my business, I made a plan.

I have to say we all have our crosses to bear. Some are prepared, others are not. I am rather tired of having to bail out people who live for today and tomorrow be damned. Crop farmers have to deal with crop failure once in a while. Livestock farmers have to deal with disease. Game ranchers should be able to deal with a season of bad bookings. If they can't, then sell out to those that are wiser and have money put aside for a rainy day.

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I have to say we all have our crosses to bear. Some are prepared, others are not. I am rather tired of having to bail out people who live for today and tomorrow be damned.

Well said, Russ. Unfortunately, many operators have overextended themselves thinking that the international hunter's pot of gold is ever full and endless and will always be there, without having a contingency plan for any unanticipated disaster-be it death, a pandemic, a drought, a severe financial downturn. . . . . .well, you all get the picture. I do know of other operators who have had a backup plan for years through a diversified business portfolio or other ancillary businesses. Those are the ones who are likely to survive. It's dangerous to put all of your business eggs in one basket and expect to survive.

Sad to hear this.

But, this same thing is reflected i all other businesses.

Those who have been intelligent enough to work within their means, will survive.

Those who have been greedy, and used borrowed money to finance their businesses are going to suffer.

Talking to a friend who works with a major bank in Europe they are already blocking so many accounts, and demanding payments. On some they are asking for payment back with no interest, as long as payments are made immediately.

Same with credit cards.

So many are being blocked, I really have no idea how some people are going to live.

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Those who have been intelligent enough to work within their means, will survive.

Those who have been greedy, and used borrowed money to finance their businesses are going to suffer.

Very well said, Saeed! Many are over leveraged.

All of us are in the same boat. For the first time in our history, we have had to apply for funding to get us through this year. Fortunately, we do not owe money.

Nonsense! Please do your research before spreading this false news.

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Originally posted by KMG Hunting Safaris:
Nonsense! Please do your research before spreading this false news.

Why don’t you enlighten us on how many people foreign hunters have arrive in SouthAfrica to hunt lately??

Or does money grow on trees on game farms??

quote:

Originally posted by Saeed:

quote:

Originally posted by KMG Hunting Safaris:
Nonsense! Please do your research before spreading this false news.

Why don’t you enlighten us on how many people foreign hunters have arrive in South Africa to hunt lately??

Or does money grow on trees on game farms??

The number of hunters currently in South Africa has zero to do with what I am saying. "Collapse" is a very strong word which would signifies that it will not recover. Calling the South African wildlife model and "experiment"?
Media sensationalism at its best.

Most of the land owners here around our areas have purchased extra small stock and cattle, since the game are mostly natural occurring in anyways.

quote:

Originally posted by KMG Hunting Safaris:

quote:

Originally posted by Saeed:

quote:

Originally posted by KMG Hunting Safaris:
Nonsense! Please do your research before spreading this false news.

Why don’t you enlighten us on how many people foreign hunters have arrive in South Africa to hunt lately??

Or does money grow on trees on game farms??

The number of hunters currently in South Africa has zero to do with what I am saying. "Collapse" is a very strong word which would signifies that it will not recover. Calling the South African wildlife model and "experiment"?
Media sensationalism at its best.

Most of the land owners here around our areas have purchased extra small stock and cattle, since the game are mostly natural occurring in anyways.

I wish you nothing but the best, truly.
That said, I keep ranches profitable for a living and can tell you with 100% certainty that changing models on the fly is about like turning a tanker around in canal for a ranching enterprise.
Ranches, like any business, being over leveraged is the kiss of death. A crisis like this breeds opportunity for the best/luckiest operators, spells doom for the over leveraged and unlucky and the guys in the middle just hope to make it out the other end to lick their wounds.
No agenda here, just what I’ve gleaned from my career.

quote:

Originally posted by zebrazapper:

quote:

Originally posted by KMG Hunting Safaris:

quote:

Originally posted by Saeed:

quote:

Originally posted by KMG Hunting Safaris:
Nonsense! Please do your research before spreading this false news.

Why don’t you enlighten us on how many people foreign hunters have arrive in South Africa to hunt lately??

Or does money grow on trees on game farms??

The number of hunters currently in South Africa has zero to do with what I am saying. "Collapse" is a very strong word which would signifies that it will not recover. Calling the South African wildlife model and "experiment"?
Media sensationalism at its best.

Most of the land owners here around our areas have purchased extra small stock and cattle, since the game are mostly natural occurring in anyways.

I wish you nothing but the best, truly.
That said, I keep ranches profitable for a living and can tell you with 100% certainty that changing models on the fly is about like turning a tanker around in canal for a ranching enterprise.
Ranches, like any business, being over leveraged is the kiss of death. A crisis like this breeds opportunity for the best/luckiest operators, spells doom for the over leveraged and unlucky and the guys in the middle just hope to make it out the other end to lick their wounds.
No agenda here, just what I’ve gleaned from my career.

Sir, maybe if you do an about turn on your model like you say, yes, but most of the animals in our area are naturally occurring, so cost zero to maintain or demand zero overheads. That is hardly an about turn as what you are mentioning.
South Africans are some of the best farmers in the world.
I'll back them to come out of this and not "collapse"

I really hope you are right.

South Africa’s game farmers have been doing a great job, and I would hate to see them suffer.

This isn’t the first time South Africa has had a challenge, and I’d reckon they’ll find a way forward.

More than a few SA cattle farmers got into the game farming industry for better profits. If the profits of operating a game farm become less attractive long term than cattle farming, some will go back to cattle farming.

If corn is more profitable than wheat, then you grow corn, if soybeans are more profitable than corn, you grow beans.

At the end of the day, it's farming.

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At the end of the day, it's farming.

Now I know why the keep saying “I harvested a gold medal bontebok with yellow sin on one side and white on the other”

True but without farming, the poor Bontebok would have been wiped out. But if you have ever "hunted" one, you would quickly understand why they were almost wiped out.

Actually, I have nothing but utmost respect for the game farmers, in South Africa and elsewhere.

Without game farming many animals would not exist today.

I wonder how many cows and pigs and sheep we would have if it was not for farming.

Some of our friends here who are so adamantly against lion farming should bear this in mind.

They have an asset that is marketable regardless.
May not generate the same amount of revenue if culled as opposed to shot by a "hunter" paying trophy fees and still allowing the meat to be sold, but an asset nonetheless.