Johannesburg, Gauteng, SA (15 December 2022) – Consumers face an expensive braai season as they enter the December festive with meat inflation at the highest level for this period since November 2017 when it reached 14.9% y/y.
      What underpins the current strength in meat prices? A combination of factors have been at play including the tight supplies due to the pedestrian livestock slaughter, reduced imports of chicken amid higher prices, and the surprisingly resilient consumer demand despite tough economic conditions with the consumer’s financial welfare under strain.
      In addition, livestock producers faced enormous cost pressures emanating from a surge in raw feed input prices that necessitated the cost recovery as profit margins were severely squeezed.
      The price of maize, a major ingredient in feed manufacturing, has so far increased by 43% and 28% y/y for the white and the yellow maize respectively to an average R4,989/ ton and R4,837/ ton. The price of soybeans, a major source of plant protein in livestock feed, so far averaged R10,561/ ton which is 39% higher y/y.
South Africa’s November 2022 consumer price inflation (CPI) surprised on the downside to 7.4% year-on-year (y/y) from 7.6% September, but was still off the 2022 peak of 7.8% y/y reached during July, according to recent data from Statistics South Africa (Stats SA). The monthly CPI slowed by 0.3% month-on-month (m/m) in November from 0.4% m/m the previous month.
      After steadying in October, the food CPI rebounded by 0.5 percentage points in November 2022 to 12.8% y/y and still the highest level since April 2009 but decelerated by 0.5% m/m 0.9% higher month-on-month (m/m).
In contrast, the global food price inflation as measured by the United Nations Food and Agriculture Organization (FAO) slowed significantly from the 2022 high of 34% y/y in March to just 0.3% y/y in November 2022 with the monthly prices remaining in negative territory for the past eight consecutive months at -0.1% m/m. Prices were down across the cereals, the dairy, and meat categories which more than offset gains in the vegetable oils and sugar.
      Within the SA’s food CPI subindex, the November meat CPI steadied but still reached the highest level in fourteen months at 10.5% y/y.
      A deep dive into the meat CPI data shows that beef T-bone steak surged by 18% y/y in at R135.48/kg, followed by brisket and chuck with increases of 11.8% and 10.4% respectively y/y. In the pork category, pork ribs and fillet posted modest gains of 3.9% and 2.8% y/y at R94.59/kg and R104.62/kg. However, pork chops fell by 3.8% y/y at R89.55/kg. Lamb chops rose by 4.8% y/y to R195.55/kg. For chicken, prices were up across most categories with an increase of 7.2% at R63.85/kg for fresh whole birds while the individually quick frozen (IQF) 2 kg chicken portions rose by 5.1% y/y at R86.69.
      Nonetheless, we expect some reprieve for consumers early in the New Year as the lower seasonal demand post the December holidays in a tight economic environment with costs of electricity and transport still elevated likely to place downward pressure on meat prices.

Pretoria, Gauteng, SA – Subject to a package of public interest conditions, the Competition Tribunal has approved the proposed merger whereby Karan Beef Feedlot and Karan Beef (Pty) Ltd intend to acquire the businesses of SK Caine Farming, Caine Farming (Pty) Ltd and Triple A Meat (Pty) Ltd.
      The conditions imposed on the transaction seek to support cattle farmers classified as historically disadvantaged persons (HDPs). The conditions also include supplier, enterprise and socio-economic development commitments.
      Karan Beef Feedlot is involved in crop farming, silage production and the backgrounding and feeding of cattle (feedlotting) to produce slaughter cattle. Karan Beef’s activities relate to the slaughter of cattle produced at the feedlot; deboning beef carcasses; packaging primal cuts; and the wholesale and retail of beef carcasses and deboned/primalised cuts of beef.
      The target firms are active in crop farming to produce feed for the cattle in their feedlot. They produce cattle for slaughter; slaughter all cattle produced in their feedlot at their abattoir; and supply beef carcasses and deboned/primalised beef cuts to wholesalers and retailers.

Johannesburg, Gauteng, SA – Crocodile farm and tannery Le Croc has bought luxury leather goods manufacturer Lorenzi Exclusive Handbags for an undisclosed sum, effective from 01 August 2022.
      "Le Croc has always been interested in creating full vertical integration in the exotic leather value chain," said Le Croc MD Stefan van As. "Our operations now cover crocodile breeding and rearing, tanning, manufacturing, and retail of exotic leather products."
      A full article on the takeover and the plans for the business will appear in the November issue of S&V Footwear and Leather Goods, due out on 29 November.

Böblingen, Germany (22 September 2022) - Schill+Seilacher GmbH launched SUCCUIR, a new pre-tannage and tannage at this year’s Lineapelle, September 2022 Trade Fair. The product is based on a triose that is derived from vegetable oil waste streams. A White Paper was also launched at the fair which details the technology. The technical team are available to answer any questions and to supply you with the White Paper, directly. Alternatively, the White Paper will be available for download from the website: www.schillseilacher.de
      The product launched focuses on sustainable chemistry, biodegradability, process versatility, and biogenic chemistry. The talk presented on the 21st September, in two exclusive sessions, highlighted a product that is 100% biogenic (which is of great interest for the automotive sector). Additionally, the sugar tanning method allows a highly biodegradable and renewable tannage, which can be made into any leather article.

Pietermaritzburg, KZN, SA - Leather From Hart, SA's only remaining heavy leather tannery - making veg-tanned leather in pits and drums - burnt down over the weekend.
      Jonathan Munro, director of Cordova Leathers, which is in the same complex in Plessislaer, said the veg plant had been "totally destroyed", but that Cordova, and a wet blue contract tanning operation, were unaffected.
      He said the cause of the fire was unknown as the veg plant was not working over the weekend. He didn't know how much work in progress there had been, but nothing had survived.
      "It's hard to say when it will be resuming production, but we're putting plans together to resume some operations next month. We're all devastated but in high spirits despite the carnage. ‘The view is always the best from climbing the most difficult mountain’. LFH will rise like the Phoenix from the ashes."