Rising costs weigh down crocodile farming sector

Rising costs weigh down crocodile farming sector Padenga Holdings Limited management is upbeat the firm will meet its target cull of 46 000 crocodiles this year

Conrad Mwanawashe Business Reporter
RISING operation costs coupled with the high cost of capital are weighing down the crocodile farming industry which naturally requires huge capital outlay.

The crocodile farming business, which could be a critical export earner for the country, raked in $26 million from skin exports with meat exports valued at more than half a billion dollars in 2014, according to data from the Crocodile Farmers Association of Zimbabwe (CFAZ).

Crocodile skins are mainly exported to France, Singapore, Japan, Italy with meat targeted for the Belgian and Asian markets.

However, the industry faces acute challenges which require policy interventions to cushion against increasing competition from other crocodile farms in the region, especially in South Africa and Mozambique.

CFAZ said increasing costs relating to power, levies/permits and labour are some of the leading challenges the industry is grappling with.

“The project is long term requiring at least 7-8 years to break even. It is also seasonal requiring a very strong financial support as working capital.

“With high interest rates and current liquidity issues it becomes very expensive to run a successful crocodile farm,” CFAZ said in written responses to The Herald Business.

CFAZ said crocodile farming demands consistent supplies of high quality feed and extensively trained human capital to meet the required local and international standards.

“The lucrative skin markets are all abroad and crocodile farming needs a lot of money to produce top quality products to meet these markets’ demands. The meat export market to Asia is facing huge pressure from cheaper croc meat coming from the harvest of wild crocodiles from countries such as Thailand,” the association said.

“There is a widespread misconception amongst the public and prospective farmers that crocodile farming is an easy way to earn money. It is not. The production of high quality crocodile skins requires intensive and skilled management.”

Zimbabwe’s crocodile management is internationally acclaimed and is an outstanding example of co-operation between Government and the private sector.

Over the years, the crocodile farming industry has established international markets that however demand, and only accept, consistent supplies of high quality skins.

The industry is fighting off stiff competition from crocodile farms in the region, but the local market is somewhat secure as the farmers supply through local tanneries.

“Most of the skins produced are destined for export as the local uptake of quality skins is very low. Local tanneries are unable to process skins to the standard required by the international buyers,” the association said.

The annual production is about 80 000 crocodiles in an industry which employs approximately 1 100 permanent staff directly involved in crocodile farming.

The bulk of the crocodile companies are operating in the hotter regions of the country such as Kariba, Binga, Victoria Falls and Mwenezi.

Leading companies in the sector include Padenga Holdings based in Kariba and CWE – a joint venture between the National Parks and Wildlife Management Authority and Lake Harvest also based in Kariba.

There are several smaller indigenous players in the Deka, Mhangura and Chinhoyi areas.

CFAZ has 18 members but since it is a voluntary association it does not necessarily represent all the crocodile farmers in the country.

However, the crocodile association has been important in the development of crocodile farming as a mainstream agro-wildlife industry.

In its early years, it contributed significantly to Zimbabwe’s campaign to move its population of C. niloticus from Appendix 1 to Appendix 11 of the Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES) under Resolution Conf. 3.15 on ranching.

The association works closely with Parks and Wildlife in the issuing of CITES export seals and the association prepares a detailed annual report for Parks on the status of the industry which is then sent to CITES.

CFAZ liaises with the Department Veterinary Services and farmers over disease control and statutory monitoring. It also acts as a focal point for information for skin buyers and producers and feed companies.

It recently produced and adopted an industry code of practice that all members are required to adhere to as it recognises the importance of animal welfare in farming enterprises and in line with international trends.

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