Tuesday, March 2, 2021

Unhappy investor closes down Botswana’s biggest dairy farm

Jan Oosthuizen’s has announced that he is shutting down Lobatse’s Sunnyside Dairy, the biggest dairy in the country because of difficulties ever since coming to Botswana from his native Namibia seven years ago.

The difficulties are further accentuated by capital investment losses amounting to P500 000, dishonoured 25-year lease agreement, equipment depreciation, volatile milk producer prices, unavailability of arable land, and Government’s indifference and deafening silence over repeated requests for answers. “I have informed all the relevant authorities at the Ministry of Agriculture I cited my reasons for taking up the decision. Unfortunately they informed me that they didn’t have vehicles to come to my farm”, he laments. Oosthuizen who entered into a 25-year lease agreement with the Botswana Government seven years ago was running a self funded business in which he had invested start up capital of P9 million. As he closes his business Oosihuizen says he bitter as he reflects on his millions that have gone to waste.

“I have had a host of unexpected problems since starting this business as such I made the difficult decision to suspend all operation,” he said. Oosthuizen has turned his back on dairy farming and is slaughtering his herds as a cost-saving strategy, at a moment when Botswana dairy industry is in “intensive medical care”. Botswana is a net importer of dairy products and government has been making efforts to foster dairy development plans wherever the potential exists. Statistics show that the local dairy production has been on a downward spiral since 2009. At present local production is at an alarmingly low 5 percent of the national consumption. Because the local dairy industry is very small, Sunnyside right from the time of inception was the only big, thriving and largest supplier of fresh milk.

The dairy farm used to be home to more than 450 dairy cows, is now left with 260 cows on sale with 80 cows already slaughtered. But, despite this promising scenario, the powers-that-be have made the playing field uneven due to unrealistic complications for the seven years. Attempts to dispose the bulk of the dairy cows through sales have not been easy because no buyers are forthcoming. The enormous gap is expected to haunt not only the country ailing dairy industry, also the big milk suppliers like Clover, Sally Dairy, Parmalat as well the SMME’s who were trying their luck in the dairy supply industry. The closure of Sunnyside farm will also have a serious effect on other eight companies that have been loaning milk from Sunnyside. It’s a shock to many who have sentimental attachments with the farm who know that the dairy industry failed to take root in Botswana due to lack of skills and knowledge. “It is hard to see the only survivor succumb to odds!” About 40 employees have been laid off and the remaining 10 are expected to lose their jobs in two weeks time.

A sombre atmosphere engulfs the farm as workers are battling to come to terms with the fates of unemployment. Oosihuizen, who has been running this business for seven years with completely no grazing space, has been importing feed from Zambia and South Africa. “I can’t carry on like this because the business is not viable anymore. I am caught between a hard rock and the deep blue sea; I can’t continue running a loss and neither can I leave the cows to die from hunger,” he mourns. The dairy farmer has trained approximately 519 aspiring dairy farming students at his farm. To add on that government visitors that would come from Netherlands, China, Burkina Faso, would be brought here to have a feel of the dairy farming industry in Botswana When Oosihuizen started his operations at Sunnyside he was producing about 7000 litres of milk everyday but due to feed shortages he had to cut down to producing between 3-4 thousand litres a day. “President Lt General Seretse Khama Ian Khama’s has come out on several occasions emphasising the need to develop the dairy sector as investors but nothing is coming forth complement our efforts as investors,” he said.

To overcome the feed shortages when we started we were hopeful that we would engage with government to provide us with feed from their Ramatlabame farm. However, nothing came up. “I have lodged complaints to the different departments within the Ministry of Agriculture. Out of the 10 letters outlining our plight, we have not received any feedback and I am tired of writing letters. “I have been unsuccessful in acquiring land; I have applied all over Botswana through the tender system to the Banyana, Sedibeng, Kanye, Matetsi Land Boards and was told there is no arable land. “I applied to the Pitsane Land Board and I was told milk is not a priority in Botswana; arable land is earmarked for arable farming and not milk production,” said Oosihuizen. Surprisingly , the government’s Economic Diversification Drive (EDD) strategy of 2011-2016, promoted by the Ministry Trade and Industry, identified dairy as a priority sector and despite the importation of milk and dairy products presenting itself as an obvious opportunity for Batswana entrepreneurs to explore the industry. As per the lease agreement, government is required to maintain all the equipment at the premises but unfortunately they have failed to live up to expectation.

Oosuihuzen says when he walked into the premises in 2006, about 110 components including accessories on the equipment were not working including the milk tank, pumps amongst other things. “I have inquired serious loss of P250 000 due to the dilapidated equipment”, he said. Dairy farming requires constant supply of water and due to the water shortages Oosuihuzen suffered a big blow. “We are fully depended on Water Utilities Corporation (WUC) the water shortages to us meant no production, I had to get water for my cattle with a bowser from Gaborone” In September 2012, the Vice President Kedikilwe toured his farm and was impressed with the progress. “I took advantage of his visit and relayed to him all my challenges; he was very supportive and promised me that all these problems will be sorted out. But now it’s over a year and two months nothing has happened,” he said. Owing to limited living space at the farm, he had to live far from his farm and this left the premises susceptible to thieves. “I asked for an extension of the farm so that I could build my own house and reside at the farm but I was denied that.

To date I have lost goods worth P 70 000,” he said. To add on to his plethora of problems, Oosihuizen has a serious setback with baboons eating cow feed, with approximately 300 to 400 baboons visiting his farm every day. He engaged the Department of Wildlife, who then informed him that they didn’t have vehicles to attend to his problems at the farm. “I was given a simple but unrealistic answer of them not having cars to drive to my farm. I have tried to negotiate with the relevant authorities in a sober manner with the hope amicable solutions can be reached. Already I have lost P6 million, if I can’t get a buyer for the remaining cattle in the next two weeks; my total loss will amount to P8million,” he said.

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