Livestock auctions offer tremendous opportunities for new-era farmers but they also come with risks. By understanding the legal requirements, preparing financially, conducting thorough research, and seeking mentorship, you can make informed decisions that benefit your farm for years to come.
As an agricultural consultant and member of the Beefmaster Breeding Council, Ndumiso Gule shares valuable advice to help prepare upcoming farmers to succeed in these events.
Gule is also the founder of Gule Agri Consulting (Pty) Ltd, a 100% black-owned AgriSETA-accredited company specialising in livestock production skills and knowledge transfer.
Know the Animal Identification Act
Before even attending an auction, farmers need to learn the laws regulating livestock sales in South Africa. Farmers are encouraged to familiarise themselves with the Animal Identification Act No. 6 of 2002.
“First, you need to prove that the animal you’re bringing to the sale or auction is yours. This is done by branding the animal. Every animal sold at the sale needs to have a brand which correlates or traces back to the owner,” Gule says. He notes that this ensures traceability, which is crucial for both buyers and sellers.
Related posts
Animal health
Additionally, maintaining animal health is of utmost importance. Livestock must be disease-free, with particular attention to foot-and-mouth disease (FMD), one of the most feared and devastating illnesses in the industry.
“All animals that come to a sale need to be inspected at eye level and must appear healthy,” he says.
Auctioneering companies have inspectors and agents who visit farms to ensure the animals meet the necessary health standards before being allowed to be sold at an auction, Gule mentions.
“We want healthy animals so that when you walk into a pen, they all look at you, they all move with agility, healthily.”
One of the critical factors is ensuring the health of the livestock at auctions. Buyers should evaluate the coat, skin, and general alertness of animals to identify signs of good health.
Farmers from emerging markets, Gule points out, may not always follow strict vaccination programmes or dipping schedules, so it’s important to ask about the health management of the animals before making a purchase.
“That’s where we have a bit of a challenge with emerging or communal farmers. They don’t follow a health vaccination programme, dosing programme, or dipping programme Even though they might already have poor genetics in terms of the quality of the animal, management is also an issue,” he says.
Financial preparation for auctions
Gule advises farmers to prepare financially before attending an auction, either by having cash on hand or securing a loan, which requires a strong financial standing.
“Before they get a loan, they need to have a good financial status or good assets that the bank can hold for recovery should they fail to repay the loan.”
Whether purchasing animals for breeding, feeding, or short-term resale, Gule emphasises understanding the long-term and short-term financial implications. Breeding stock, for instance, is a long-term investment, while feedlot cattle yield returns over shorter periods.
“We all need money to buy animals. When a farmer sends animals to a site, they need to join an association, a local livestock owners’ association,” he recommends.
The bidding process
Understanding the bidding process is essential to leaving an auction satisfied. Breeding stock, for example, has a set price that ensures the seller breaks even. Bidding typically starts at this price and can increase quickly, depending on demand.
“Prices for bulls can go as high as R100 000 or even more, depending on the quality and demand,” says Gule.
Farmers are advised to understand their feeding costs and set a maximum price they’re willing to bid. This way, a farmer ensures that the investment will be profitable in the long run.
Research is crucial
New-era farmers are also encouraged to visit successful breeders or feedlots for hands-on learning.
“You will learn a lot of shortcuts and tricks from them, more than you will learn in a book, on social media, or the internet. If you want to be the best Beefmaster breeder, you must first identify who the best Beefmaster breeder is in your province or district. Then you go and visit that person.”
Farmers should pay attention to the specific traits of the breed they want to purchase. “Make sure the animals are adapted to your environment,” he says, adding that farmers should visit breeders in similar climatic conditions to understand how their animals perform.
ALSO READ: How to prevent common causes of cattle abortions
Sign up for Farmer’s Inside Track: Join our exclusive platform for new entrants into farming and agri-business, with newsletters and podcasts.
