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Dairies looks at sustaining its future

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Technical Head of Namibia Diaries, Pieter van Wyk, believes that Namibia Dairies will look different in the near future as it will continue to leverage its strengths while incorporating change and innovation to enhance sustainability.

He highlighted that no matter how bleak market conditions seem, Namibia Dairies is far from raising the white flag. He noted that since its infant industry protection was phased out over a decade ago, the local dairy industry has been vulnerable to dairy products imported from other countries, particularly South Africa.

“Local industry players struggle to compete with these cheaper imports from markets with lower input costs and larger economies of scale. The local dairy industry is further disadvantaged by the value-added tax that must be paid on Ultra-High Temperature (UHT) milk sold in Namibia, as well as by unfavourable exchange rates when importing specialized supplies,” van Wyk said.

The good rains received this year may have provided minor relief for some extensive farmers with smaller outputs, but the same cannot be said for players in larger, intensive farming activities, such as at the Aimab Superfarm where most of the Dairies’ milk is sourced.

“The exiting of farmers and the overall reduction in milk production have resulted in the current shortage of UHT milk produced in the country, which is set to further decrease. Currently, Namibia Dairies has been receiving about 800,000 litres less of raw milk per month from its farms than it did two years ago,” van Wyk added.

He further stressed that this decreased supply was recently met with an increased demand for UHT and extended-life products compared to fresh products owing to the COVID-19 pandemic.

As such, van Wyk added, Namibia Dairies is proactively reimagining its offerings and operations and its portfolio of products will be expanded and diversified. The company remains committed to providing the country with its Nammilk brand, but in future, Namibia Dairies will be pushing the boundaries beyond its current dairy and non-dairy offerings.

The company has the largest cold chain distribution network in Namibia, connecting it to local depots across the country.