Minister Joseph Made

Business Editor
ZIMBABWE needs to invest in cotton beneficiation to increase earnings from the crop and promote its production by farmers, a Cabinet Minister has said. With a majority of farmers losing interest in cotton growing due to poor pricing and alleged manipulation by buyers, Parliament has piled pressure on Agriculture, Mechanisation and Irrigation Development Minister Joseph Made, to come up with measures of ensuring farmers benefit more from the crop.

Ginners stand accused of buying cotton at less than the recommended $0,30 cents/kg.

“The price of cotton doesn’t motivate our cotton producers and, I think that we’re actually killing the cotton industry. We’ve people, especially from the Midlands where I come from and they survive on the growing of cotton. What’s your ministry doing to review the price of cotton?” Mkoba South MP, Amos Chibaya, asked in Parliament last week.

Given that cotton prices are being determined by the buyers, Minister Made responded, the long term solution to the dispute lies in beneficiation.

“We know that at the moment, the buyers are the ones who determine the prices and they’re complaining that the prices of cotton where they sell it are very low.

“What’s important is that we should focus on beneficiation so that we use cotton here in making a lot of things, using our cotton which we grow; so that we can sell finished products rather than exporting the raw material,” he said.

A pricing dispute between farmers and ginners has caught the attention of the Competition and Tariff Commission (CTC), which recently issued an order against the Cotton Ginners Association of Zimbabwe to desist from unfair trade practices.

“The members of the Cotton Ginners Association of Zimbabwe forthwith cease and desist from engaging in restrictive practices of setting uniform prices of seed cotton bought from cotton farmers, and that the members individually negotiate such prices with their contracted farmers,” said CTC in a statement.

“Now therefore it is hereby ordered-that ginners and farmers negotiate an advance payment at the beginning of the cotton marketing season; and that ginners adjust the price of seed cotton after grading the seed.”

CTC said price adjustments should take into consideration relevant factors including economic value of seed and the international price of lint at the end of the cotton marketing season.

Zimbabwe is among the world’s top cotton producing countries despite the dwindling land area put under the crop in recent years due to falling prices.

A report released by Index Mundi, a global brokerage global portal in February this year, ranked Zimbabwe on number nine among cotton producing countries on the continent.

On a scale of 192 top cotton producing companies worldwide, the country was ranked number 27 and produced 112,554 metric tonnes of lint (processed cotton) in 2014.

Minister Made said the country stands to gain more through exporting processed products such as clothes and blankets than raw cotton.

“That’s what our government desires to realise and that’s what our President is encouraging us to do — to focus on beneficiation of raw materials,” he added.

Minister Made stressed the need to revive the Cotton Marketing Board, which used to buy cotton from farmers so that it gives a fair price in the selling of the produce.

He said the government was looking at the input costs incurred by cotton farmers with the view of minimising the burden.

“The Ministry of Industry and Commerce is looking into that to see that our equipment and inputs are low cost so that our farmers will realise a better margin/profit from their proceeds. I can’t articulate everything but. . . the government is also seized with that issue,” said Minister Made.

He said the government would not allow the cotton industry to collapse given its value chain effect on the entire manufacturing industry.

Apart from fibre, cotton produces oil and seed cake that is used as livestock feed.

Minister Made said cotton processing firms were making a killing out of selling cotton by-products, which should be retained by farmers as well for the benefit of growing the sector.

“This is an industry that as government we shouldn’t let die. Farmers are crying that many depots have been closed but I’ve talked to AMA (Agricultural Marketing Authority) to open those depots so that farmers don’t travel long distances to sell their cotton. We’re doing everything so that the farmers will benefit,” said the minister.