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Zimbabwe: Maize Producer Price: Farmers Recommend $15m Per Tonne

Published on 30 March, 2006, Last updated at 01:49 GMT

30th March: ZIMBABWE - FARMERS are seeking a maize producer price of at least $15 million a tonne from the $2 million gazetted last year, citing high production costs.

The Ministry of Agriculture is expected to announce the new price soon and industry officials say they have already submitted their recommendations. Zimbabwe Farmers' Union (ZFU) president Mr Silas Hungwe yesterday said that farmers wanted "a viable price" after experiencing a tough 2005/6 agricultural season. "A favourable maize producer price is important in ensuring that farmers are able to sustain operations," Mr Hungwe told Business Chronicle in a telephone interview. "Our members are of the view that a maize producer price of about $15 million a tonne will be ideal," said Mr Hungwe.

The Government has urged farmer organisations to consult their members about the producer prices. Mr Hungwe said that a high inflationary climate was likely to erode profits from the sale of the commodity. "The current $2 million producer price for a tonne of maize is no longer sustainable and we feel that a huge adjustment will enable farmers to prepare adequately for the 2006/7 season," he said. Mr Hungwe said that the Government had assured them of a realistic maize producer price adjustment during consultations. An official with the Indigenous Commercial Farmers' Union (ICFU) said that the organisation was seeking a producer price increase of between $10 million a tonne and $15 million a tonne. "We have not yet finalised our consultations with members but we hope for a better producer price which will also boost earnings for the farmers," he said.

The official said that farmer associations would soon meet to agree on a common producer price, which would improve maize deliveries to the Grain Marketing Board (GMB). "A favourable producer price is crucial because farmers are faced with continued increases in the prices of fertilizers as well as fuel shortages," said the ICFU official. At least 2 million tonnes of grain are expected this year against a national demand of about 3,6 million tonnes. The shortfall is expected to be imported. Meanwhile, the GMB Boar d is planning to diversify its operations and venture into stockfeed production to widen its portfolio and earnings base, its chief executive officer has said. Retired Lieutenant-Colonel Samuel Muvuti told Business Chronicle in a telephone interview on Monday that the GMB was in talks with the Ministry of Agriculture as well as stakeholders in the poultry industry about setting up a stockfeed milling division. "The GMB is considering establishing a stockfeed production unit but that plan is subject to ongoing discussions with interested parties," he said.

The Ministry of Agriculture was considering proposals to that effect, he said. Rtd Lt-Col Muvuti noted that the poultry industry has been experiencing production constraints due to the limited supplies of stockfeed, adding that a reliable supply chain would help restore confidence. The shortages have resulted in the poultry producers buying inputs at prohibitive prices, leading to poor investment in the sector as costs cont inue to spiral. "Stockfeed products continue to be scarce due to the depressed agricultural output but the GMB is considering contracting farmers for this purpose," said Rtd. Lt-Col Muvuti.


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