Manufacturers must support the producers 

by | Dec 23, 2021 | Business, Local News | 0 comments



Nevanji Munyaradzi Chiondegwa


The Government of Zimbabwe has set pre-planting producer prices for 2022 intake season as follows:


Maize           $58 553/t

T/grains       $70263.90/t

Soya beans  $125 530.17/t

Sunflower     $150 686 /t


The producer prices are not set on by accident.

They are an instructive guide to farmers on what to concentrate on producing and on what Government is mostly interested in having produced in large quantities.


It also helps in the pre-planning stages of farming. One can not expend lots of resources on a crop that is not going to pay back.


It is interesting to see that Soya bean and Sunflower producer price are the highest.


Even higher than the traditional grains which usually fetch very high prices.


This is not accidental at all seeing that soya-bean oil and its faggregates( bean crude oil )are one of Zimbabwe’s major imports.


In 2020 alone, the country  used US$128m to import soya beans and crude oil from mostly South Africa with a significant portion coming  from Argentina, Mauritius, Brazil, Korea, Zambia, and China.


South Africa and Zambia have almost similar climates to Zimbabwe, similar soils, rainfall parttens.


This then means that the huge amount of money we exported was money that we could have saved and invested in our own Agriculture.


Had the huge amount been invested in Agriculture, jobs would have been created, expanding our tax base, increasing consumers, prices of cooking oil and other Soya bean extracts kept low.


This would inadvertently have benefitted the country and economy as a whole.


So, in response to the shortage of soya bean, United Refineries  which is one of the highest users of Soya bean oil, started an out grower alliance (SOBOA) initiative in 2018 when it combined forces with Zimbabwe Agriculture Development Trust, Agribank, CBZ Bank, ZB and FBC to boost soyabean production.


The initiative by United Refineries and Government helped the country  achieve a Soyabean production jump of 51 percent to 71 290 tons in 2020/21 season comparative to 2019/20.


United Refineries and its partners expect contract farmers to grow soyabean on about 10 000 hectares this year under its soya bean outgrower alliance (SOBOA) initiative against 350 000ha target.


In 2017 Ministry of Lands, Agriculture, Water, Fisheries and Rural Resettlement Permanent Secretary John Basera when he was still with CBZ penned an article which stated that National demand is 220 000 metric tonnes per annum.


Considering the production against demand, it means that farmers have to tripple production through increasing both yield per hactre and actual hectarage.


For this reason, it was prudent to increase the producer price of Soya beans and Sunflower, one being an alternative of the other.


President Mnangagwa once asked Minister if Indusrty and Commerce Dr Sekai Nzenza to have her Ministry compile all agricultural produce that the country imports so that there could be a deliberate policy of import substitution.


The new producer price are reflective of this deliberate government policy to encourage producers to get into the production of these much needed oil seeds.


The biggest threat to Zimbabwe’s economic recovery and currency stabilisation is still the import bill.


The country imports more than it exports and mostly the imports are eaw materials including those that the country could very well produce.


Pizza base, fatty oils and crude oil and other raw materials used in food production, cooking oil, margarine, soap and so forth could all be substituted with the money being invested in local production of same and retooling exercise for our industry.


A simple look at the foreign currency allocation by the Reserve Bank of Zimbabwe will show most is going to manufacturers and these are on food industry.


It is then incumbent on both the manufacturers and Ministry of Agriculture to encourage partnerships between farmers and manufacturers for the growth of these raw materials that the country keeps importing.


The country by raking up such a huge import bill on items which could be locally produced is doing a disservice to itself. Jobs are being exported, taxes lost, skills lost, assets such as land being underutilised, much needed foreign currency being abused.


The action not only causes economic instability especially on the balance of payments and pressure on the local currency, it leads to de-industrilisation.


This is what Government must be fighting against especially after giving farmers land.

The more our farmers grow, the more the country substitutes on imports, the more jobs are created, the higher taxes the country earns to invest in social goods and services.


By insisting on importing especially non-essentials, the country is doing itself more harm than good. There is absolutely no need for the continued insistence on importing what local farmers can grow especially under our climatic conditions.


We can not import soya beans and sugar beans from either Zambia and South Africa as if the two have different climates to us.


Agricultural produce should be heavily invested in by both the Government and private sector as the endeavours to rebuild and revive the economy.


The President Mnangagwa Administration recently signed the Global Compensation Agreement with former white land owners putting closure to the land reform.


This therefore means indigenous farmers on the land have nothing to fear anymore and can now develop and utilise the land fully.


It is time the people especially those on the land paid back the faith shown by the Government in entering the said agreement with former commercial White farmers.


All those in the Agricultural value chain must understand that they need each other. If a manufacturer needs a certain item as raw material, it is only to be expected that them outlaying funding for the production of the raw material allows them control over the price. It is less costly in the long run to be involved along the value chain than to be importing.


In my opinion, Government should give tax holidays to all manufacturers who get in the value chain and invest in Agriculture as did United Refineries.


If each maker of bath and washing soaps, margarine, and vegetable oils was to involve avail funding for producers, in a year, the country will be having a surplus.


This means then the country can export while enjoying lower prices for most of our consumer items which are now being affected by the need to import raw materials.


Zimbabwe is our country, it is our land, the only country we have, let us build it!