ZSE- listed agro-food processing firm, National Foods Holdings Limited is upbeat about the prospects of a bumper harvest this year which could spell out positive outcomes for the company following a difficult past season characterized by shortages of raw materials to sustain production.
Zimbabwe experienced serious grain shortages last year due to two successive droughts that badly damaged crops.
However, a recent crop assessment done by government attest to a bumper harvest this year and improved dam levels for irrigation which will translate to local availability of raw materials such as maize, wheat and soya beans.
"The country has enjoyed an excellent cropping season, with production of most key grain crops expected to significantly exceed the levels achieved in recent years. On the back of this harvest, National Foods expects to source all of its maize requirements locally over the coming 12 months," said National Foods secretary, Leigh Caroline Howes.
"Turning to the outlook, the improved harvest should drive further improvements in consumer spending power. This should result in sustained volume momentum in all categories with the exception of Maize, where it is expected volumes will be impacted by increased retentions at a household level," said Howes.
According to the crop assessment, maize production this year improved 199 percent from prior year to reach 2.7 million metric tonnes with traditional small grains production also having improved 128 percent from last year to 347 968 metric tonnes.
Last year production was affected by intermittent availability of raw materials mainly maize and wheat and to compound matters, the company had to endure delays in importation of maize into the country due to COVID-19 disruptions within the supply chain and also shortages of foreign currency to settle external payments on time.
In October, National Foods announced importation of 60,000 tonnes of maize to sustain its trade for the remainder of 2020.
Analysts have also welcomed an improved harvest saying this will ease pressure on foreign currency demand for imports.
"The pressure for foreign currency on manufacturing industry is likely to ease since most raw materials will be readily available and can be accessed using the local currency," said Pepukai Chivoore, economic analyst.