RANCH NO: 74-MP, 3590 HA, ZONE 3 RANCHES
RANCH MANAGEMENT PLAN
Commercial Livestock Ranches Central District Ms Anitah Malapela Ms Chipo Mpho Petros Theme: Sustainable beef production is the way to economic diversification
Prepared for: Ngwato Land Board Prepared by: Mabrix Enterprises (Pty) Ltd. 15/05/2015
TABLE OF CONTENTS
Contents 1.0 PARTICULARS OF APPLICANTS ................................................................................................................ 1 2.0 PROJECT OVERVIEW................................................................................................................................ 1 3.0 PROJECT IMPLEMENTATION (HOW THE PROJECT WILL BE EXECUTED) ................................................. 2 4.0 PROJECT OBJECTIVES (CONTRIBUTION TO SOCIO ECONOMIC DEVELOPMENT) .................................... 2 5.0 JUSTIFICATION OF THE BREEDING CHOICE ............................................................................................. 2 6.0 EMPLOYMENT AND MANAGEMENT SKILLS ............................................................................................ 3 7.0 LIVESTOCK MANAGEMENT PRACTICES ................................................................................................... 3 8.0 RANCH DEVELOPMENT ........................................................................................................................... 5 9.0 ENVIRONMENTAL ISSUES........................................................................................................................ 6 10.0 MARKETING........................................................................................................................................... 6 10. RISK ANALYSIS ......................................................................................................................................... 7 11.0 FINANCIAL PROJECTIONS ...................................................................................................................... 8
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Ranch Management Plan
1.0 PARTICULARS OF APPLICANTS 1. NAME: Anitah Malapela ADDRESS: P.O Box 1117, Orapa Contact Number: 71310276 Nationality: Motswana ID Number: 366428304 Application Category: WOMEN EDUCATIONAL QUALIFICATIONS- BSc in Security Management (Edith Cowan University, Perth, Australia), Certificate in Security Management, UNISA, South Africa 2. NAME: Chipo Mpho Petros ADDRESS: P.O. Box 1527 Orapa Contact Number: 71408621 Nationality: Motswana ID Number: 77328005 Application Category: WOMEN EDUCATIONAL QUALIFICATIONS- Bachelor of Business Administration, ACCA (stage two) COMPANY PROFILE Mabrix Enterprises (Pty) Ltd is an emerging economic support player in Boteti Sub District, Botswana; recently registered and seeking funding from the Citizen Entrepreneurial Development Agency (CEDA) to deal in the business cattle production, arable farming and agro-business projects. It’s a local owned enterprise consisting two Batswana women directors.
2.0 PROJECT OVERVIEW According to Centre of Applied Research (Crop-livestock systems development in Botswana, 2005) the country’s economy has grown significantly and steadily over the last decades. In addition, families have explored and exploited non-agricultural livelihood opportunities. Formal employment and government support currently contribute more to rural livelihoods than arable and livestock sectors (BIDPA, 2002). Therefore, it is important that the agricultural sector becomes more appealing, also to women, and increases its productivity and returns. This would attract more full-time farmers. In brief, the agricultural sector has to deal with a large but marginal natural resource base (that may further marginalized due to global climate change) and growing competition for resources from the non-agricultural sector. Around 70% of the land is agro-climatically suited to cattle grazing. Given the small population of roughly 2 million people, cattle production has therefore considerable space. The cattle industry has long been the dominant rural and national economic sector, boosted by exports to the European Union. After the development of groundwater, the cattle sector has spread throughout most of the country. Botswana has a large traditional and a small commercial cattle industry. The sector has traditionally benefited from strong government support in the form of veterinary services, subsidies and tax advantages as well as a well-developed beef processing infrastructure. The parastatal BMC holds an
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Ranch Management Plan
export monopoly on beef and operates across the country. The effective veterinary services have boosted exports and were successful in limiting and eradicating disease outbreaks, with increased fencing, disease control, water development, supplementary feeding, etc., there is still potential for greater incomes, employment and overall stronger performance in the Botswana beef industry.
3.0 PROJECT IMPLEMENTATION (HOW THE PROJECT WILL BE EXECUTED) The project is to be implemented in three distinct phases within a period of three years. The proposed project will be located in the Boteti Sub-District, zone 7 within the central district. PHASE
DESCRIPTION
Phase 1
Borehole drilling and equipping, reservoir construction, construction of perimeter fence, accommodation, stocking of breeding stock, construction of handling facilities and building storage facilities. Construction of the fire breaks along the boundaries, construction of paddocks, range assessment, creation of fodder production field. Construct fire breaks along the imaginary boundaries, construction of additional paddocks and reticulation of water to a radius of 1km to avoid over grazing
Phase 2 Phase 3
4.0 PROJECT OBJECTIVES (CONTRIBUTION TO SOCIO ECONOMIC DEVELOPMENT)
Improve national and household food security; Diversify the agricultural production base and income levels and employment opportunities; Provide a secure and productive environment for those engaged in agricultural related activities; Develop and conserve scarce land and agricultural resources for future generations. Increase agricultural productivity and output.
5.0 JUSTIFICATION OF THE BREEDING CHOICE The producers have decided to rear Charolaise and Brahman breed. The Charolaise breed has changed the nation’s thinking regarding efficient beef production standards. Today, Charolaise top all breeds in nearly every category of performance in the records of beef performance testing organizations. The popularity of the Charolaise is owed to nothing other than its own attributes. Charolaise have a deep, very broad body with heavily muscled loins and haunches. The cattle are relatively easy calvers and cows boast fine maternal instincts. Charolaise possess superior growth ability and have economically gratifying terminal weights. They are so widespread in use that adaptability has been irrefutably proven. The Brahman is mainly used for breeding and the meat industry. Brahman cattle are known for their extreme tolerance to heat and are widespread in southern regions. They are resistant to insects due to their thick skin. Brahman cattle live longer than many other breeds, often producing calves even at ages 15 and older.
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6.0 EMPLOYMENT AND MANAGEMENT SKILLS Ms Petros will be able to execute on the project because of her invaluable skills as she holds a Bachelor’s degree in Business Administration, her managerial experience will enable her to take charge in the ranch, ensure a focused leadership empowerment, strategic thinking, corporate sensitivity, project management and managerial control. Ms Malapela is also holding a Bachelor’s degree in security management, her skills and experience will be implemented to enforce security principles on the ranch and on the livestock. A top down management style will be used, in which hierarchy plays an important role in delegating and ensuring that objectives are met. The communication and leadership model will be as shown below.
MS PETROS & MS MALAPELA
RANCH MANAGER
RANCH ASSISTANT
HERDs MAN
ROLES/ RESPONSIBILITIES: PRODUCERS (Ms Petros and Ms Malapela) Responsible for ensuring the purchase and implementation of appropriate technologies for the project and ensure its sustainability and quality assurance with the aid of suppliers, specialists etc. Establishing and managing profitable business development strategies Overall responsibility for ensuring profitability of operation. Ensure training of employees RANCH MANAGER
The ranch manager will be responsible for day to day technical operations of the farm as well as supervision of farm workers. FARM WORKERS Herdsmen will be responsible for the well-being of the animals on daily basis. General work required to be done on the farm.
7.0 LIVESTOCK MANAGEMENT PRACTICES In Botswana, livestock depends to a large extent on extensive grazing of native rangeland pastures. These native ranch land pastures have low nutritive value and as a result do not adequately provide for the nutritional requirements of livestock. This coupled with overgrazing contributes in no small measure to low productivity and reduced farm income. The producers are to address this challenge by extensively undertaking fodder production. Fodder production will not on its own provide all the feed requirements for livestock. This will have to be complimented by appropriate grazing systems. Grazing system is basically a planned effort by rangeland managers to leave some grazing areas unused for at least part of the year. With respect to this particular management plan it will not be possible to select a proper grazing system as that is contingent upon the uniqueness of the setting in which it is
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applied. The survey alluded to earlier on to determine topography; soils, vegetation type, general climate etc will inform the selection of the grazing system. Government has taken a variety of measures to boost the sector’s performance and efficiency, in particular promotion of fenced ranches with rotational grazing, artificial insemination, veterinary services and disease outbreak control, including the expensive Livestock Identification and Trace-Back System (LITS) to comply with EU import requirements. The implementation of proper ranch management practices is essential in determining the quality and revenues that will be generated. STOCKING RATE The stocking rate is to a large extent influenced by the type plus density of animals to be reared. The guiding principle in the ranch management will be quality as opposed to quantity. It will be ensured at all times that the stocking rate does not exceed the carrying capacity of the ranch. Notwithstanding the above, it is envisaged that the operations will start with at least 200 cows, 4 bulls. CONTROL OF VELD FIRES We will construct fire guards in and around our ranch to protect the vegetation in case of a veld fire from outside. We will minimize the chances of causing veld fire from within our ranch; hence our employees will be trained and cautioned on the dangers of starting fires. RECORD KEEPING Records will be kept to facilitate farm planning and budgeting. These are farm activities and transactions. Records will assist in determining the profit and assess the financial condition of the project; it will enable the promoter to compare their efficiency of production. Both production (breeding, livestock, ranch records and labour) and financial records (sales, profit and loss, cash and payroll) will be kept. PADDOCKING We shall establish paddocks that we will assign to each type of animal. Paddocking will ensure that we maintain a healthy grazing area for our stock. Paddocking also ensures easy access and follow-up on the count of our animals to increase the tracking systems that we will implement with the help of veterinary companies. FENCING –Knowing the exact boundaries of our ranch is a sign of good management and will help avoid problems should question arise if and when neighbouring farms are sold. We will use permanent fences around our ranch and temporary fences within our farm. We will use wood, barbed wire, wire panels and electric fences to enforce security. MANURE MANAGEMENT –Solid, semi-solid, liquid; each of these will be handled in a different way to effectively use the manure. We will also use the composting method for storage of our manure. PASTURE MANAGEMENT –By rotating pastures through the paddock system we will minimize any run-off effects. A permanent work force will be established to carry out pasture maintenance, where these will on a daily basis remove pasture weeds i.e. grasses/shrubs that are not eaten by the cows. In the future, equipment will need to be purchased for cutting overgrown grasses.
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SOIL CONSERVATION- We will minimize any activities that will cause deforestation and we will also ensure that we plant trees and plants where necessary to avoid soil erosion. HEALTH CONTROL- The health control program for the farms will mainly be comprised of: Spraying of animals: This will be done in the already established spray races, using a solution of decatex or any other accaricide recommended by the veterinary staff. The spraying will take place once a month during the dry season and every fourth day during the wet season. At the time of spraying, it is important to ensure that every animal goes through the spray race, as such an inventory of all animals will be carried out at every time of spraying. The veterinary personnel will from time to time advise management. De-worming: The Adult herd will be de-wormed once every four months and the calves will be de-wormed every month. Vaccinations: Vaccinations will be carried out depending on the disease threat in the area/neighbouring districts. Veterinary assistant/doctor will be consulted to advice the farm every year of what vaccinations if any that should be carried out. Sick animal’s identification: The herds-men have daily contact with the animals, they will therefore be trained and have the responsibility of looking out for signs/symptoms of any sick animals. These have to immediately be reported to management for either treatment or carrying out any preventive measures to the rest of the herd. BRANDING: For the purpose of identification and registration, the farm will brand all animals. A branding program with the oldest animal branded no. 1 and the youngest having the “highest” number will be adopted. Branding will be done once every four months. Before being branded the calves will be identified by piercing the ears following punch numbers for each spot. DE-HORNING: In order to avoid the animals from causing injury to each other all heifer calves will be de-horned. This will be carried out once every four months. CASTRATION: some of the bull calves will be castrated, nurtured and later sold off for beef. Castration will be carried out once every four months. There will, however, be a selection of some bull calves that will not be castrated, but kept for breeding purposes or for sale.
BREEDING The basic objective of animal breeding is to enhance the efficiency of production and the quality of the product for the end-consumer through planned genetic change. The choice of whether to straight breed or cross breed will be related to your ability to match your cattle, the environment and the market. A normal breeding season that start on January and end on March where calving will be expected at early October to December will be followed but more advanced techniques such as artificial insemination will effectively be implemented.
8.0 RANCH DEVELOPMENT The ranch will be developed in two distinct phases as indicated in the table below:
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PHASE 1 ACTIVITIES
DURATION / MONTHS
PHASE 2 ACTIVITIES
DURATION / MONTHS
Erecting perimeter fence
Survey Citing of water point(s) Drilling
12-24
Erecting internal fences
Construction of handling facilities
Establishment of fodder crop
Stocking
Commence commercial activities
24-36
9.0 ENVIRONMENTAL ISSUES •
• •
• • •
•
•
Environment: This shall entail the clearing up of the internal line for perimeter fencing as well as internal fences (paddocks). Clearing to be done for fodder production shall be carried out with utmost care for vegetation and soils to ensure that the place is not disturbed of its natural environment outlook. Sanitation: Construction of ablution facilities conveniently on the ranch shall be done according to the standards of the Ministry of Health. Waste Management: Strategically positioning of waste skips and rubbish bins around the ranch to ensure that all material waste is disposed off in an environmentally sound manner. The rubbish bins to be adopted are those with a self-closing mechanism accompanied with maintenance workers who will be picking up any material waste on the ranch. Chemicals: The use of chemicals will be minimal. They will be used mainly for cleaning purposes and veterinary services. Organic agriculture will be practiced for fodder production. Waste Water: Will be collected and recycled and reused to water the gardens and other suitable purposes. Food and Beverages: Provision of food and beverages will be guided by clear waste management, health and safety standards to be religiously adhered to by each worker at the ranch or visitors. Harmful Emissions: Effects of harmful emissions such as automobile emissions, industrial emissions and the emissions from the power using coal are negative and our facilities shall not produce any of the harmful emissions such as CO2. Fire Fighting: For safety smoke detectors, automatic water sprinklers and fire extinguishers will be installed. We shall put the response numbers for fire fighters in every building and ensure there are easily accessible escape routes from any buildings and ranch. Fire breaks will be constructed along the perimeter fences as well as along the internal fences.
10.0 MARKETING The Botswana cattle farming industry –a specialised Livestock husbandry sector is in a period of relative stability. The market is growing in response to the support from government and farmer educational
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initiatives. Although the cattle sector in Botswana has remained the mainstay of the economic activity in much of rural areas the benefits have not been gained much especially that most of the projects are small scale and not professionally run. The Botswana Meat Commission is the cornerstone of Botswana Beef Industry in that about 70 % of cattle destined for slaughter go through it. The BMC act stipulates that the commission should promote the interests of the livestock industry of Botswana and in particular ensure that as far as reasonably possible all livestock offered or available for sale in Botswana are purchased at best possible prices. Steers will be marketed at slaughter weight of 400kg live mass at 18 months old after being fattened at the farm feedlot. Our target market is not only BMC, but it ranges from individuals to food processers, restaurants, supermarkets, Lodges, Hotels, Educational Institutions, Hospitals & Clinics, Government and Butchers. PROJECT VIABILITY There is great potential for growth in the industry since coupled by growth in population largely due to an influx of foreigners into Botswana. We will grow this project through in house intensive breeding, purchase of more breeding stock and investing through new farmlands in other areas around Botswana. This species are easy to be managed and handled by women and children hence assuring the viability of this project. Our product portfolio is to increase based on market demand and may venture into other related businesses. There is a growing desire among the community for easily accessible and reasonably priced fresh meat and milk consistent with the cultural make-up of the community. We will also consider investing in other related business activities such as birds rearing (Chicken, Goose etc.) as one of his future goals. DISTRIBUTION CHANNEL We shall use a truck to be purchased to deliver the goats to the customers and also for going to procure them from suppliers. When we start producing our anticipated high quality meat, we would be consistent in our supply to the market so that our customers will always have the privilege to choose the meat that comes from our animals. Consistency is a fundamental aspect for the success of any farmer in this market hence it should be observed at all times. It will be important therefore that we become consistent in our supply of high quality meat to our market.
10. RISK ANALYSIS PROJECT RISK
CONTINGENT MEASURE AND SOLUTION
1. Death of cattle as a result of uncontrollable disease/Poor health due to disease.
The Project producers will always seek advice from the experts such as veterinary doctors. The project promoters will approach a suitable Insurance Company and will insure the cattle as soon as the project commences.
There are predators such as Lions, Jackals and Hyenas which can impact negatively on the production of livestock.
Routine checks will be done by the cattle keeper who will ensure that the livestock is safe at all times.
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Death of cattle and small stock as a result of accidents
If cattle are to be transported we will choose times which there will not be much traffic such as early hours for transportation and also observe good driving.
Death of cattle as a result of fire , explosion and lightning
Proper farm fire protection mechanisms such a fire guards will be part of the ranch.
Theft of cattle
Cattle will be branded and inserted with bolux and other resources to ensure security of livestock.
Death of cattle as a result of poisonous plants
If plant poisoning is suspected, a post-mortem, examination of the rumen contents would provide confirmation of the cause by finding leaves and stems of the poisonous plant. We will continually identify poisonous plants and destroy them through burning (just the tree and not the velds), uprooting or cutting. Further relevant medication will always be available.
Retention of experienced Staff
Introduce staff incentives for them to stay and also ensure all staff are trained on cattle diseases, symptoms, cure and feeding among other areas.
Impotency in male cattle
The project will identify males with good hereditary background. The project will also keep hereditary records of its current stock. We will always have substitutes male stock to service the females
SWOT ANALYSIS/RISK SENSITIVITY Strengths
Weakness
Management is committed and confident. Market demand is not seasonal Market for the sale of locally produced cattle is guaranteed by the B.M.C and there is a private sector market which offers better prices Opportunities
We cannot supply end-users abroad Limited budget. Processes and systems have to be developed.
The ability of small stock to browse makes them of particular importance to Botswana, where there is an abundance of species for them to browse (acacia for example) which provides forage year round and will come into leaf before the rain start. Availability of VET support from government Availability of raw materials e.g. feeds, vaccines Availability of government short training courses on animal husbandry
Threats Disease outbreaks Retention of key staff critical. Possible negative publicity on Botswana meat and the susceptibility of disease Staff turnover.
11.0 FINANCIAL PROJECTIONS Setting both production and economic goals is important for livestock producers. Producers should consider striving for the higher number of pounds weaned per exposed female. Producers will consider their annual cost to maintain their breeding herd, whether it is by purchasing or raising replacement animals. This cost or value of the net inventory change will be greatly affected by such things as the cost
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of replacement animals, the number of productive years spent within the herd, and the cull value of these animals when sold. Table 1: Project Capital Costs QUANTITY
UNIT COST
TOTAL COST
200
3,500.00
700,000.00
10 21
6,000.00 1,000.00
60,000.00 21,000.00
Building & fencing materials for kraals Labour for construction (kraals and shelters)
1 8
40,000.00 1,200.00
40,000.00 9,600.00
Bore hole drilling and equipment (water for 12 months)
1
100,000.00
100,000.00
Breeding stock 200 @ 3000.00 Bulls 10 @8000.00 Feeding and drinking troughs
Sub-total Operating costs Advertisement
930,600.00 12
800.00
9,600.00
2 1
21,600.00 36,000.00
43,200.00 36,000.00
Manager’s salary @ P2000.00 per month for 36 months
36
2,000.00
72,000.00
Protecting Clothing electricity for 3 years Sub-total Gross total 10% contingency Total project costs
4 36
500.00 2,000.00
2,000.00 72,000.00 162,800.00 1,093,400.00 109,340.00 1,202,740.00
Labour for two herd boy @ P600.00 for 36 months Vet. Medicines, equipment and supplements
Item/Period Sales Opening Balance Males Females Total sales Fixed Costs Breeding stock
[email protected] Bulls
[email protected] Transport (hired) Feeding and drinking troughs Construction material
Table 2: Projection Income Statement Year 1 Year 2 Year 3
Labour for construction Sub-total Operating costs Loan Repayment Labour for 2 herd boys @ 600*1yr
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Year 4
0.00 0.00 0.00
48,600.00 31,200.00 79,800.00
72,000.00 81,100.00 153,100.00
83,200.00 102,600.00 185,800.00
700,000.00 60,000.00
0.00 0.00 0.00 0.00 0.00
0.00 0.00 0.00 0.00 0.00
0.00 0.00 0.00 0.00 0.00
4,500.00 814,030.00
0.00
0.00
0.00
7,200.00
7,200.00
7,200.00
7,200.00
12,000.00 2,030.00 40,000.00
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Farm Assistant/Driver Manager’s salary @2000*1yr Vet. Medicines, equipment & suppl. Advertisement electricity Usage Sub-total Total costs
9,000.00 24,000.00 9,000.00 2,250.00 3,000.00 54,450.00 868,480.00
9,000.00 24,000.00 9,000.00 2,250.00 3,000.00 42,450.00
9,000.00 24,000.00 9,000.00 2,250.00 3,000.00 42,450.00
9,000.00 24,000.00 9,000.00 2,250.00 3,000.00 42,450.00
Total Cash Outflow
868,480.00
42,450.00
42,450.00
42,450.00
110,650.00
143,350.00
0.00 37,350.00
Net Cash Balance
Table 3: Cash Flow Projections Month: Receipts Sales Total Receipts from CEDA
Pre-Start
YEAR 1
YEAR 2
YEAR 3
0 1,202,740.00
79,800 79,800
153,100 153,100
185,800 185,800
0 1,202,740 0 0 0 0 0 0 0 0 0 0 0 1,202,740
16,200 0 3,000 5,000 1,500 1,000 1,000 100 400 800 9,000 3,000 100 41,100
16,200 0 3,000 5,000 1,500 1,000 1,000 100 400 1,000 1,500 3,000 100 33,800
16,200 0 3,000 5,000 1,500 1,000 1,000 100 400 1,000 1,500 3,000 100 33,800
Cashflow Surplus/Deficit (-)
0
38,700
119,300
152,000
Opening Cash Balance
0
0
38,700
158,000
Closing Cash Balance
0
38,700
158,000
310,000
Payments Salaries( Herd boys and Managers) Opening Stock(Project Costs) Utilities Repairs and maintenance Insurance Car Hire, Delivery and Travel Telephone connection Postage Office supplies Advertising and licensing Vet. Medicines, equipment & suppl. Training and development Bank charges Total Payments
NB: average selling price per animal: Cows- P4000, Heifers- P3600, Bulls- P8000m Tollies- P3800 The project will be viable according to the information provided in the above statements of the financial analysis especially the sales and production forecast and this will depend on the management of the ranch which will determine the outcome of the results of the project.
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