Cabinet reviews wheat floor producer price

by | Sep 22, 2021 | Business | 0 comments


– As Zimbabwe wheat becomes self-sufficient for the first time since 2005

Brian Rungano Temba

Following a successful wheat season, Zimbabwe is anticipating a volume of more than 300 000 metric tones of the cereal, against a national annual requirement of 360 000 metric tonnes.

This will add to the current national wheat stocks which stand at 70 000 metric tonnes, making Zimbabwe wheat self-sufficient for the first time since 2005.

During yesterday’s Post Cabinet Briefing Information Publicity and Broadcasting Services Minister Monica Mutsvangwa told media that Cabinet has approved an upward review of the wheat floor producer price.


“Following extensive consultations with various stakeholders, including farmers’ unions, Cabinet has approved an upward review of the wheat floor producer price to ZW$55 517.69 per mt for ordinary grade wheat at a 15% return on investment, and ZW$66 621.22 per mt for premium grade wheat during the 2021 marketing season. This will enable farmers to go back into production,” said Minister Mutsvangwa.

Minister Mutsvangwa said the upward review of the producer prices is being necessitated by changes in input prices, which in turn resulted in higher production costs.

“Farmers expect viability in their operations, and are grappling with cost increases in Labour (51 percent); fertilizers, both Compound D and Ammonium Nitrate (27 percent); and tractor and equipment (144 percent),” said Minister Mutsvangwa.

The input increases have a net effect of a 32% increase on the total variable cost per hectare. The net contribution of inputs to total wheat production costs in 2021 is as follows:

– Labour, 3.19 percent;

– Seed, 5.14 percent ;

– Fertilizers, 26.15 percent;

– Chemicals, 3.20 percent;

– Operations, 12.37 percent.

“The biggest driver of costs is the cost of borrowing which stands at 40 percent,” added Minister Mutsvangwa.

Cabinet is convinced that a viable producer price will incentivise farmers to deliver their wheat crop to the Grain Marketing Board.

The GMB has made adequate preparations for the 2021 wheat intake apart from decentralizing payment facilitates too all depots for the convenience of the farmers.

These interventions will ensure the attainment of the food and nutritional security plus availability of bread on shop shelves as part of National Agriculture Policy Framework (2018-2030) towards the attainment of a Middle Income Economy (Vision 2030).

“Additionally, Government will avail the requisite funds to pay for deliveries. The harvesting of the wheat is expected to commence this week, and should be completed by mid-November 2021.


The nation is also informed that the current subsidy framework to millers will be maintained,” said Minister Mutsvangwa.