To appreciate South Africa’s game breeding potential, consider these statistics:
Pre-1994, the number of commercial farmers declined from 60 000 to an estimated 37 000 by 2012. Game ranchers, however, increased from 9 000 before 1994 to more than 15 000 in 2015.
An estimated 40.5% of all commercial farms participate in wildlife ranching in one way or another, aided by increasingly industry-friendly agricultural and environmental policies. Hence, turnover in the wildlife industry has grown at an average rate of 20,3% per annum over the past 15 years, and it is showing no signs of slowing down:
- A cattle ranch purchased for R25 million will typically produce earnings of less than R1 million (4%) per year.
- Sable antelope purchased for the same amount could generate an income of R7,2 million (27,2%) per year.
- Returns on sable and buffalo sales have consistently outranked listed equities on the Dow Jones and JSE ALSI over the past five years.
- The average selling prices for buffalo and sable grew by 540% and 479% respectively over the last five years. Industry experts expect this trend to continue, as a large number of potential participants have not yet entered the market.
This unprecedented growth is driven by extraordinary demand from the rapidly growing tourism, hunting and game meat industries, and is attracting astute businessmen, farmers and celebrities.
While sector growth will always be subject to speculation, the South African game industry is not in a ‘growth bubble’ for the simple reason that it has been funded by cash, not credit, up to now. Due to demand, growth is therefore likely to continue and even accelerate over the next 3 to 5 years.