30 November 2012

Zimbabwe: Cotton Seed Producers Shun Shops

PRODUCERS of cottonseed have indicated that they will not distribute the commodity to shops but to agents throughout the country.

Quton Seed Company managing director Mr Edward Mhandu told Herald Business that they had so far moved only 10 tonnes of seed to agents in Kadoma, Glendale, Mt Darwin, Guruve, Chinhoyi, Karoi, Bindura, Masvingo, Gokwe and Checheche.

"We started moving the seed at the beginning of this month. The factory price of a 15kg pocket of seed is US$21,60 and when we move it to the agents and factor in other costs it will then be sold at US$25 per pocket.

"In shops the same pocket would sell for US$30, which most farmers would find unaffordable so it is better to have the commodity accessed through agents for the benefit of the farmers," said Mr Mhandu.

Mr Mhandu further explained that unregistered farmers would buy the 15kg pocket for US$26 with the extra dollar being used as registration fees.

He also said that distributing seed in retail outlets would attract costs for them, as they would need to register for compliance with the Agricultural Marketing Authority, which would leave the commodity unaffordable to farmers.

The country needs an average 8 000 tonnes of seed per season, a figure the seed producers say is easy to meet as they have 10 000 tonnes in stocks.

"We are going to distribute more seed depending on the demand. This is in line with the request we received from Government and the farmers' unions to decentralise our services and take them closer to the farmers.

"Also, the size of seed pockets has since been reduced to 15kg from 20kg because we are now using acid limited seed that has a high yielding capacity. Farmers will also need to adjust and plant 15kg per hectare instead of the 20kg that they had been used to," he said.

Most cotton farmers have expressed concern over the unavailability of cotton seed in shops, which they said was forcing them to grow the crop under contract, which they said was leaving them at the mercy of contractors.

The farmers have argued that producing free cotton would make them richer as they would pocket all the proceeds from the sale of the crop and not share them with the ginners, who in most cases are the contractors.

Mr Mhandu, however, said that the situation could only improve for farmers if the cotton they produce is sold as processed products and not in its raw form.

"If only the country was practicing value addition then there would be every reason to expect higher returns but as it stands there will be nothing of that nature in the near future.

"We are exporting about 98 percent of our cotton unprocessed to countries such as China where they process it and later sell the processed products back to us," said Mr Mhandu.

Farmers in most parts of the country do dry planting of cotton in November but this has not been possible for the 2012/13 season as they have not yet managed to access seed, raising fears of a decline in the hectarage to be planted.

This will also translate into a decline in yields of the white gold.

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