Maize producer price headache for farmers

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IT is two months since the start of the marketing season for maize and this season is no different from the past that have been marred by price disputes between farmers and private buyers.
The Grain Marketing Board (GMB)’s marketing season runs from April 1 to March 31 of the following year.
The past marketing seasons have been characterised by price disputes with farmers not happy with prices offered by private buyers taking advantage of the failure by the GMB to pay farmers in time.
Government announced at the commencement of the maize marketing season that the producer price was US$390 per tonne.
During the 2013/2014 marketing season, the entity was buying maize at US$378,68 per tonne indicating a 28 percent rise from the 2012/2013 season’s US$295.
However, private buyers are offering prices as low as US$180 per tonne.
Zimbabwe Commercial Farmers Union president, Wonder Chabikwa said the situation on the ground was depressing as maize farmers were being ripped off by private buyers.
Despite the increase in the price offered by the parastatal, farmers have continued to shun delivering maize to GMB as it has failed to pay them.
“This is a very difficult time for the farmers as they have the crop and the buyers are offering prices that will not allow them to break even,” Chabikwa said.
“Maize buyers want to make huge profits at the expense of farmers, offering them prices lower than the cost of production.
“Grain traders and millers are taking advantage of the loss of confidence by farmers to GMB and offering prices that will not allow farmers to break even because they know farmers.”
Since the start of the marketing season, GMB has only paid for the first 5 000 tonnes delivered to its depots.
Farmers’ representatives, Chabikwa said, “We are in the process of negotiating with buyers to review prices.”
Contrary to reports in some sections of the media that farmers’ unions and the Grain Millers Association of Zimbabwe (GMAZ) had reached an agreement to increase the producer price from US$220 to US$340 per tonne, Chabikwa said the two parties were still negotiating.
He urged farmers to withhold their grain and wait for the negotiations to be complete.
“There is no way we could have agreed to US$340 per tonne as it is below the set producer price and below the US$400 we have always wanted in the first place,” Chabikwa said.
“There are a number of issues to consider before we reach an agreement with the buyers, for instance, they argue that they compete with cheap imported maize meal on the market.”
Banning imports of maize and maize meal, said Chabikwa, would ensure that local farmers become the first choice for buyers.
During the 2012/2013 season maize hectarage increased by 18 percent from 1 408 329 hectares (ha) planted during the previous season to 1 655 366 ha during the last season with high yields expected.
The country requires two million metric tonnes of grain to meet its yearly requirements.
In recent years, production fell below the required levels and Government had to import the surplus.
Last year, the country imported 150 000 tonnes from Zambia at a cost of US$70,6 million which translated to US$470,67 per tonne.
However, to buy the same 150 000 tonnes locally at the prevailing price Government would have forked out US$56,9 million.
Chabikwa said the countries exporting to Zimbabwe had low costs of production compared to that for local farmers and they were importing surplus maize.
Zambia has an excess of one million tonnes of maize, Malawi 600 000 tonnes and South Africa has nearly four million tonnes.
Chabikwa said measures should be put in place to ban imports of maize and maize meal.
“Most countries that are exporting maize have a surplus and they just want to offload their maize,” he said.
“Measures can be put in place through the application of surtax application to discourage those who want to import as they will be required to pay more to import for example.”
Agriculture has remained the key sector of the economy.
Under the Land Reform Programme, more than 400 000 black households benefitted and since then, indigenous Zimbabweans have been the drivers of the sector.
Despite efforts by the West to sabotage the programme, resettled farmers have remained resilient.
Government had in the past been the major supporter of resettled farmers.
As the marketing of maize continues, it is hoped that farmers and buyers reach an agreement with the latter offering favourable prices.

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