Investors track game sector growth

2010-09-25 14:46

The rare-game industry is delivering double-digit growth for investors and attracting some prominent ­business names.

At a public auction this week by game marketing company Vleissentraal, businessman Piet du Toit bought a buffalo bull of exceptional genetic stock for R9.2 million.

It is rumoured that Cyril Ramaphosa will jointly own the bull, but when contacted, he denied any knowledge of the purchase.

He did, however, ­acknowledge that he knew Du Toit.

The second-highest bidder at the auction was insurance mogul Douw Steyn’s Shambala Game Reserve, which spent R6.84 million on a ­buffalo bull earlier this year.

The director of research and conservation at Wildlife Ranching SA, Professor Piet du Plessis, said ­investing in game can offer a return of between 20% and 25% on your original capital. He also said the game farming industry was not only for those who wore khaki clothes.

“There are some serious businessmen who are in the game industry because they know a good investment when they see one,” he said.

Wildlife such as buffalo and sable antelope were a good option for ­investors keen on realising their ­returns in the short run, Du Plessis said.

Buffalo breed every 16 to 18 months from the age of four and sable antelope breed every 12 months from the age of three, but rhino only start breeding from six, at three-year ­intervals. At auctions, the females of the different game species often fetch higher prices.

Game farms breed these animals for sale to trophy hunters and to ­supply other farmers for breeding purposes.

Rhinos are currently trading at a substantial discount because of poaching. Keeping rhino is seen as a liability by some.

Vleissentraal’s Johann Vosser said: “This is a good year to buy rhino for the sake of an investment.”

According to Vosser, there were fewer animals on the market this year as farmers feared the auctions alerted poachers to the whereabouts of the animals.

He said when news broke of a major poaching ring bust this week, rhino prices climbed.

“We sold 10 white rhino and the cows fetched R300 000 each.”

Until recently, rhino was selling for about R230 000.

Vleissentraal auctioned more than R200 million worth of game last year.

Often a highly sought-after animal can bring in millions, but generally buffalo reaches a maximum of about R400 000 at auctions.

However, as with most alternative investments, a degree of expertise was needed to invest in game farming, Vosser cautioned.

For investors looking to enter the industry it was important to remember that it took planning and thorough management to ensure your herds were reduced at the right time to reinvest the money in the business, he said.

“It’s not so easy to get into this industry as a beginner – it will cost you some serious cash because you need to get the top quality breeding material,” added Vosser.

– Fin24.com

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