Tafadzwa Musarara
Business Reporter—
AGRO-processors want registered contract and corporate farming ventures to be placed under the Special Economic Zones to retain the current investments while also luring additional capital into contract and corporate farming.The agro-processors, most of whom have poured millions of dollars into contract farming over the years, believe that affording rights and privileges under the Special Economic Zones to contract and corporate farming would enhance production and ensure food security.
In proposals to be considered for the 2017 National Budget, the Grain Millers Association of Zimbabwe said despite the losses its members have incurred as a result of side-marketing, agro-processors were willing to support Government initiatives and hence the call to consider placing contract farming under SEZ.
“In order to retain the current investment and also attract additional capital into contract and corporate farming, we propose that registered contract and corporate farming ventures be afforded the rights and privileges provided for under the Economic Processing Zones.
“The grain milling industry has heeded Government’s call for private sector support for crop farming to all farmers across the country. Since 2009, more than 1,5 million tonnes of wheat and maize has been grown under the corporate and contract farming arrangement,” GMAZ chairman Tafadzwa Musarara said in the group’s contribution.
GMAZ is the representative body of millers in the country.
“To date the milling industry stands at default book of $5.8 million dollars. However, the milling industry remains committed to support all government initiatives in the resuscitation of crop production back to net exporter status. An 800 000 metric tonnes maize purchase commitment towards the uptake of maize to be grown under the Command Agriculture has been made to Government. Agriculture remains the least recipient of Foreign Direct Investment. Regrettably, serious losses have been registered arising from side marketing, inputs abuse and poor farming methods,” said Mr Musarara.
Operating under SEZs gives investors concessions and tax rebates and this is what millers want to tap into.
Among other recommendations, millers also want a total ban of pre-packed flour imports.
Zimbabwe consumes approximately 8 000 tonnes of prepacked flour, which provides low cost baking alternatives to low income households especially in the rural areas and is an immediate affordable source of protein, a key nutrient for children.
“Self raising flour can be produced wholly by using locally grown wheat. If self raising flour is restricted to local millers, it will create an immediate demand of 120 000 tonnes of wheat that will require about 25 000 hectares during winter season.
Accordingly, we propose that importation of prepacked flour in packages under 10kg be banned completely in order to promote wheat farming in Zimbabwe and fortify the land reform,” said Mr Musarara.
The millers argue that the milling industry shrunk in size and numbers, from 368 milling companies in 2007 to 37 in 2016 due to cheap imports of maize meal and wheat flour, mainly from Mozambique and South Africa, which crowded out local millers.
The loss of employment was the biggest since 1980, leaving several milling companies either under liquidation or judicial management.
“In order to regain on this loss and revive grain (mainly maize and wheat) farming and processing in Zimbabwe as decreed by ZimAsset, we propose that the importation of wheat flour, maize grits and maize meal be listed under Statutory Instrument 64 of 2016.
This is meant to enhance and complement the existing import controls and limit the importation of maize meal and wheat flour,” the millers said.
They also want the re-introduction of 20 percent customs duty on imported flour and cancellation of the ring fenced import facility.