Harare — ZIMBABWE is losing US$650 million in potential farm export earnings due to a deepening shortage of power and key inputs, a Parliamentary committee reports.

In its latest report on the state of preparedness for the 2007/8 summer season, the Portfolio Committee on Lands, Land Reform, Resettlement and Water Resources said farmers faced delays in the processing of loan applications, adding to already existing problems pertaining to the supply of seed, fertiliser, fuel and power.

"Apart from seed maize, your committee was informed that seed for other crops was also in short supply on the market. The sunflower situation was the most critical, with virtually nothing in stock," the report said.

"Representatives of the fertiliser industry informed your committee that the industry was not able to meet national requirements for fertiliser due to a combination of such factors as unviable prices, scarcity of foreign currency, power outages and erratic coal supplies".

Fertiliser companies said they required US$35.6 million between September last year and next month to produce 265 000 tonnes of the commodity.

The committee said even if the companies were to receive the required foreign currency, they would not be able to produce enough fertiliser as production capacity remained at 250 000 tonnes per year against a national requirement of 750 000 tonnes.

Zimbabwe's economy is heavily dependent on agriculture.

A hurried land reform has decimated the country's agriculture, resulting in a massive slump in foreign exchange receipts, particularly from tobacco, the single largest foreign currency earner.

"At the time your committee conducted its enquiry, the permanent secretary for the Ministry of Agriculture confirmed an acute shortage of fuel.

"He said only six million litres against a national requirement of 119 million litres had been sourced and this was being distributed at 1 000 litres per farmer, which stakeholders felt was a drop in the ocean if set targets for the summer crop were to be met," the committee said.

Parliamentarians said the situation regarding fertiliser and agro-chemicals had been a cause of concern to them for the past five years, with government failing to come up with a lasting solution.

On seed, growers reported the gaping deficit was a result of unviable prices, not their failure to produce.

"Your committee was informed that the country was under-producing by US$650 million worth of agricultural exports and importing goods worth US$350 million to cover mainly food deficits, annually," the report said.

In a report on the winter crop last year, the committee said Zimbabwe had accumulated a farm trade deficit of US$5 billion over the last five years.

The committee said tobacco output forecasts for this season were varied.

The Zimbabwe Tobacco Association had projected output of 120 million kg, while the Farmers Development Trust expects yields to stand at 150 million kg.

Meanwhile, a local stockbroking firm has quoted the president of the Zimbabwe Tobacco Association, Andrew Ferreira saying the country may produce 41 percent less tobacco this year than originally forecast due to the unfavourable weather conditions and a lack of fertilisers.

Initially a forecast figure of 120 million kilograms had been made but this has now been reduced to 70 million kilograms.

Zimbabwe produced 73 million kilograms of tobacco last year, earning the country US$170 million. "We're expecting a crop of less than 70 million kilograms because of drought in the early season and unseasonably heavy rains more recently have affected the crop," Ferreira said. "Some growers have opted out of tobacco because of the problems in getting hold of inputs".

Tobacco production in Zimbabwe, which produces mainly flue-cured tobacco which rivals that from the U.S. for quality, has plummeted since the year 2000 when it produced 236 million kilograms, earning Zimbabwe US$400 million.