SA wool farmers fear the worst if China ban continues

15 Aug 2022

South African wool farmers are struggling to survive after China banned the import of all cloven-hoofed animals and their products after foot-and-mouth disease outbreaks.

Wool farmers in South Africa have raised concern about the ban on wool exports to China from South Africa triggered by foot-and-mouth disease (FMD) outbreaks in the country. China announced the ban on 1 April.

Farmer Hendrik van der Walt said he would suffer financially because of the ban.

“This will also impact my farming practices. The demand for shorter lengths [of wool] is much less in the European markets. To ensure we shear long enough wool I will have to change from shearing in an eight-month interval to a 10-month interval.”

He said if the ban continued he would lose 30% to 40% of his shearing income.

“In the long run, I may have to retrench some of my workers. Coming out of the recent drought, the added strain of further loss of income will make it difficult… to continue farming.

“Longer shearing intervals and some wool that will not be sold and lower prices will put further strain on a cash flow that is already strained,” he said.

Minimum standards

Communal farmer Siphiwo Makinana said: “The South African wool industry complied with the conditions set by China regarding heating of wool. Because of lack of infrastructure… the wool sheep and wool of communal farmers and emerging farmers are below the minimum standards required by Europe.

“The communal farmers are hard hit by this ban. I lost R150,000. Retrenchment is obvious if this ban continues. I urge China to lift the ban.”

Makinana said the South African government should negotiate with China.

“It should be remembered that we are [coming] from a heavy drought and we have not recovered from last season’s floods. China is our only hope as communal farmers.”

Another farmer, Luvo Kiyane, said he used the money he earned from selling wool “to pay my employees, send children to school and put food on the table. The ban on wool by China will affect me badly as prices will decrease. Many emerging and communal farmers will stop farming.”

Kiyane said if the ban continued he would be forced to retrench workers.

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“The FMD also affects us when we sell our cattle at the abattoirs. The price of a kilogram of beef has dropped and abattoirs don’t want to buy cattle from us, fearing FMD. If China does not lift the ban, we will be forced to sell our livestock as it will be hard to maintain and pay the workers,” he said.

In a statement, Agri SA and the National Wool Growers’ Association of South Africa (NWGA) said they were extremely concerned about the ban.

“The first wool auction for the 2022/23 season is scheduled for Wednesday, 17 August and, with 70-80% of the South African clip traditionally destined for China, the ban will have a devastating effect on the local wool industry,” read the statement.

According to the statement, the value of the South African wool clip is about R5-billion per annum.

R734m exports lost

“Since the ban was announced in April 2022, the South African wool industry has thus far lost an estimated R734-million in wool exports to China. The ban also threatens the livelihoods of the industry’s 35,000 workers as well as 4,500 seasonal sheep shearers and wool handlers,” said Leon de Beer, CEO of the NWGA.

De Beer said the ban was unwarranted as South Africa had protocols in place that regulated the storage of wool after shearing for a specified time at required minimum temperatures as stipulated by the World Organisation for Animal Health.

“These measures were negotiated with Chinese authorities during the 2019 outbreak to limit the disruption to trade in circumstances such as the current one. All export facilities in South Africa have been registered with the Chinese authorities to ensure proper monitoring and accurate certification.

“Furthermore, though wool sheep are, like all cloven-hoofed animals, susceptible to be infected by FMD, no outbreaks have been recorded in recognised wool-producing areas nor have any small stock been diagnosed with FMD.”

Intervention call

He said that with South Africa’s wool auction imminent, it was essential that Agriculture Minister Thoko Didiza and Trade and Industry Minister Ebrahim Patel intervened to secure the industry’s access to the Chinese market.

“Failure to act will have devastating consequences for the industry’s workers and for small-scale producers in particular,” he said.

Christo van der Rheede, the executive director of Agri SA, said they were concerned about the emerging and communal wool-producing sector in particular, as most of their clip was destined for export to China.

“More than 40,000 small-scale producers market close to six million kilograms of wool annually, valued at an estimated R300-million. These producers and surrounding communities will fall back into poverty should the Chinese market remain closed for wool from South Africa,” said Van der Rheede.

He said many wool sheep farmers had only recently emerged from an extended period of drought, and if wool exports to China could not resume due to the ban, these farmers may not survive.

“Agri SA and NWGA can only trust that the South African authorities will make every effort to address this issue with the Chinese authorities as a matter of urgency. South African wool is safe for export, and we must resolve this matter quickly for the sake of the livelihoods on the line,” he said. DM/OBP

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Minimum standards

R734m exports lost

Intervention call