17 January 2013

Zimbabwe: Retailers Cash in On Demand for Fertiliser

BUSINESSPEOPLE are cashing in on the surge in demand for top dressing fertiliser by raising prices to between US$45 and US$58 per 50kg bag. The recommended retail price is US$35 for ammonium nitrate and US$31 for compound D.

Incessant rains being received across the country have resulted in the leaching of nutrients, forcing farmers to apply more top dressing fertiliser.

In the past, GMB would sell fertiliser to farmers at recommended prices, but this year it is not handling any inputs programme except the Presidential Input Scheme for the vulnerable.

Fertiliser producers say they distribute it to agro-dealers and business outlets mainly at growth points, giving these distributors the leeway to raise prices.

There were also claims that those receiving subsidised fertiliser ended up selling it on the informal market.

Agro-dealers justified their pricing structures citing the need to recoup transport costs.

Most farmers have been incapacitated and in worse scenarios more than three families are pooling resources to buy a bag of fertiliser for sharing.

Such is the situation in areas like Mukumbura, Rushinga, Muzarabani, Hurungwe, Karoi and Gutu.

GMB general manager Mr Albert Mandizha yesterday said: "This year we are not handling any fertiliser programme except single bags which are being given to the elderly and vulnerable groups."

Officials from Windmill (Private) Limited and Zimbabwe Fertiliser Company, the country's fertiliser manufacturers, said while they had adequate fertilisers in stock, they did not have control over the pricing.

Windmill chief executive Mr George Rundogo yesterday said most remote areas had no fertiliser agents because of weak demand.

"The product is available and the reason for the price hikes is not a result of the unavailability of the commodity," he said.

"Agro dealers might shun a certain area because the demand might be weak and when the fertiliser reaches that area it will be sold at exorbitant prices."

He said they had no control over the prices being charged by agro-dealers.

"Our duty is to supply the agents with the commodity and you will find that the transport costs they incur in distributing the commodity vary resulting in the final person on the chain having to pay a lot of money."

Mr Rundogo said production levels had improved as some debtors had settled part of their arrears.

"There has been an improvement, but Government and other clients still have to pay off but for the meantime we are producing," he said.

Government owes fertiliser companies over US$40 million.

ZFC marketing executive Mr Justice Chamuka said they were doing their best to bring the commodity close to the people.

"We are trying by all means to distribute our fertiliser to most areas," he said.

"The problem is that we do that through agro-dealers and we do not determine the final price.

We might distribute it to Mt Darwin district and it means the agro-dealers and businesspeople will have to take the commodity to areas like Mukumbura and Rushinga and they factor in transport costs despite the fact that we would have sold a bag of maize for about US$35."

He allayed fears of fertiliser shortages.

"Of course, there are financial constraints but the fertiliser is available. We urge our debtors to pay up so that we can buy resources, materials and pay utilities for us to continue producing more," Mr Chamuka said.

Villagers in Mt Darwin appealed for Government intervention.

"Most families have no option but to put their money together so that at least we buy a bag for sharing," said Mr Itai Masuku from Muzarabani.

"The prices are beyond the reach of many, if not all the villagers, and it is our hope that Government will address the situation."

Other farmers said agro-dealers were spoiling an otherwise good season.

Copyright © 2013 The Herald. All rights reserved. Distributed by AllAfrica Global Media (allAfrica.com). To contact the copyright holder directly for corrections — or for permission to republish or make other authorized use of this material, click here.

AllAfrica publishes around 2,000 reports a day from more than 130 news organizations and over 200 other institutions and individuals, representing a diversity of positions on every topic. We publish news and views ranging from vigorous opponents of governments to government publications and spokespersons. Publishers named above each report are responsible for their own content, which AllAfrica does not have the legal right to edit or correct.

Articles and commentaries that identify allAfrica.com as the publisher are produced or commissioned by AllAfrica. To address comments or complaints, please Contact us.