eBusiness Weekly
Business Writer
The forthcoming cotton marketing season is likely to be chaotic as no progress has been made towards settling outstanding payments to farmers, industry players have warned.
Farmers are owed about $1,5 billion and since November last year, the Government has persistently promised to pay the growers, mostly communal farmers but this hasn’t happened.
Cotton is one of Zimbabwe’s major agricultural export commodities alongside tobacco and horticultural products.
“Unless the government avails the funds, the season will be a disaster. We are going to have a situation where farmers would hold on to their crop because there is no longer trust.
“Last year, farmers delivered their crop hoping to be paid but up to now, some haven’t received their money,” said an executive with a local cotton ginning company.
This week, the Cotton Producers and Marketers Association, a lobby group that represents farmers could not hide the growing frustration among farmers while appealing for “authorities to urgently intervene.”
“Our hard working farmers have been thrown in at the deep end,” CPMA chairman Stewart Mobonderi said.
“We need authorities to intervene as a matter of urgency otherwise we will have a very chaotic season.
“We have been getting promises since November last year and nothing has happened.”
Deputy Minister of Lands, Agriculture, Fisheries, Water and Rural Resettlement Vangelis Haritatos told Zimpapers Radio that the Treasury had assured that the farmers would receive their dues before the outset of the marketing season.
The Agricultural and Marketing Authority has set the producer price for this season at of $85 per kilogramme. There are already growing concerns that the price, which is way above global price of lint (fibre) could throw several merchants out of business if the exchange rate remains stable. AMA said the Government was considering a subsidy.
“This will further complicate the situation . . . they are struggling to settle the outstanding payments and wants to add another burden,” a commodity broker with a local research firm told Business Weekly.
No comment could be obtained from the Ministry of Finance and Economic Development by the time of going to press.
Cotton, once one of the country’s largest foreign currency earners, had lost glitter as farmers shunned the crop due to lack of funding and poor prices offered by producers.
As a result of inadequate levels of inputs and agronomic support by cotton merchants, which led to low yields, side-marketing and poor debt recovery in the past few years, the industry almost collapsed.
Poor debt recoveries also resulted in the crop’s contractors perceiving high levels of risk and consequently cutting back on inputs financing.
In 2015, output fell to 28 000 tonnes, the lowest since 1992.
But following initiatives such as the Presidential Cotton Inputs and the export incentive schemes, production has been on the increase.
At peak, Zimbabwe produced 352 000 tonnes of cotton in 2011.
