17 November 2011

Zimbabwe: Murray and Roberts to Achieve U.S.$70 Million Turnover Target

SEEDCO is switching to a marketing-oriented focus after the group's production in the September half year period rose 71% owing to a healthy maize seed stock carryover position. CEO Morgan Nzwere told analysts that stocks were adequate in all markets for the first time in 10 years.

Production resources would now be deployed into marketing and sales in Zambia, Zimbabwe and Malawi, he said.

The group had embarked on consumer promotions across the countries, focusing on instant satisfaction.

Aggregate demand for the Zimbabwean maize market was 51 900 tonnes, for hybrid seed 35 000 tonnes, 12 000 tonnes for cotton and 5 000 tonnes for wheat.

Under the group's strategy that could turn surplus maize seed into grain, if 62 000 tonnes of seed were planted on 2,5 million hectares and the average yield was a tonne/hectare, then the output could be 2,5 million tonnes.

Alternatively if 42 000 tonnes of seed were planted on 1,68 million hectares then the average yield would be 1,5 tonnes/hectare, which would translate to 2,5 million tonnes.

Market share for the group in Zimbabwe was at 70%, Zambia at 55%, Malawi at 53%, Tanzania at 40% and Kenya at 10% but had a scope for growth, Nzwere said.

Research collaborations in the various markets was on-going, with strong relationships established with IITA and Cymmty, he said.

Nzwere said the new research farm in Kenya was now operational, with varieties nearing release while a new processing plant in Zambia had been installed.

Smaller plants had been set-up in Ethiopia and Tanzania, he said.

Nzwere said all the outstanding issues on the technology agreement with Monsanto were almost finalised.

The group was continuing with its trials in West Africa with Nzwere adding that the early results were exciting while production would be up-scaled in East Africa.

The size of the West African market is estimated around 307 000 tonnes.

"West Africa is a huge market with no real companies," said Nzwere, adding the group would soon open a business development office in the region.

Nzwere said Tanzanian cotton production is expected to be 7 000 tonnes next year in the 10 000 tonnes market. Overall cotton and soya bean demand were high.

"We expect soya to sell out as the local order book is full and we have had some regional enquiries," Nzwere said.

He said plans were underway to set up a cotton multiplication business in Malawi after the group had sold 2 700 tonnes of seed to the Malawi government.

"Zambia had also shown keen interest in the multiplication model," he said.

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