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'Devastating' bird flu culling to cost Gauteng farm R65m

Oct 11 2017 10:45
Lameez Omarjee

Johannesburg – The bird flu outbreak at operations of a Gauteng poultry producer has cost it R35m, plus an additional R30m to restore operations.

Gauteng MEC of Economic Development, Environment, Agriculture and Rural Development Lebogang Maile visited a poultry farm in Gauteng, Rooikraal Arendnes, on Tuesday. Producers of Eggbert Eggs - part of the Kuipers Group - unpacked the impact of the highly pathogenic avian influenza (H5N8) on its operations to the MEC and journalists.

Maile visited the farm and met with management to get a better understanding of the damaging impact of the outbreak.

Gawie Rossouw, general manager at Eggbert Eggs, explained that over 525 000 birds were culled at its operations at Rooikraal farm, Rooines, Maya Serobe, Rebafenyi and free range farm Arendsnes. The value of this amounts to R27.5m, based on a valuation schedule by the Department of Agriculture, Forestry and Fisheries (DAFF). This amount could be much higher, Rossouw said.

The total loss to Eggbert was R34.5m, and about R31.8m is needed to restore operations. This is essentially R65m to cover the losses and the cost needed to get the business going again, said Rossouw.

More than 470 000 dozen eggs were dumped, at R12 per dozen; this amounts to  R5.6m. Rossouw said that each dozen could have fetched R15 at the market.

He also clarified that none of these losses was covered by insurance. However, the producer had filed an application to DAFF for compensation in July after the first outbreak was reported that month. “Nothing has transpired since then,” he said.

WATCH: Culling birds has cost a farm R35m

Of the 70 staff, 50 were retrenched. As birds are placed back at the houses, staff will be brought back, assured Rossouw. He said those that were let go will have the first right to take up positions within a six-month period. The cost of retrenchment amounted to more than R830 000.

However, the producer has resolved not to place birds at the free range site, Arendsnes, as the risk of outbreak is much higher there, especially as the birds are close to packing facilities. “We learnt the hard way,” he said.

“When the disease breaks out, it's (the) worst nightmare because one operation affects the other,” said Dr Dietena Nemudzivhadi, acting chief director veterinary service, Gauteng Province.

Outbreak a ‘disaster’

“We basically lost our livelihood. It is very important for us to resuscitate the operation to get it back in production,” said CEO of Kuipers Group Charles Le Maitre. “The impact was detrimental … It is a disaster at the moment.”

The rearing farm was lost, but there are hopes to place day-old chicks on the farm for rearing from January 2018. It will then take four months before the birds can be transferred to a laying farm. It may take at least a year before the farm can be back in full production, he said.

On the retrenchments, Le Maitre said that only skeleton staff and security could be kept, but that the intention is to re-employ people as farms are replaced.

Serious crisis

Maile said that the situation is devastating. “This does not auger well for the fight against poverty because we all know the price of food has been unreasonably high. This unfortunately will contribute to an already crisis situation,” he said.

Maile said that the visit to the farm highlighted that it is a “serious crisis”. Both the government and the private sector must intervene in the matter, he said.

Apart from the compensation being provided at a national level, Maile said alternative plans must be made to help provide relief to producers.

But the compensation process appears to be delayed. Le Maitre said that a claim had been submitted to DAFF, but the department has not come forward with any compensation. “We are waiting to see if there will be any compensation and what amounts they will be able to pay out,” said Le Maitre.

Chickens on the Maya Serobe operation had to be culled. These houses are now empty. (Litaletu Zidepa, News24).

Maile said that he would be writing to Minister of Agriculture Senzeni Zokwana to fast track the compensation process. “It is not helping to take longer. It can’t be right and accepted that government should take time on anything. Our turnaround time must be quicker.

“Government can’t fold arms and be helpless. Despite limited resources we must consider how to optimally invest our resources in a prudent and accountable manner,” he said.


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kuipers group  |  poultry  |  retailers  |  sa economy  |  eggs

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