The Government said it will come up with a pre-planting producer price for cotton before the start of the season with analysts saying the move is likely to stimulate appetite for more farmers to grow the crop.
Previously, the Government would announce the price at the beginning of the selling season and this often caused tension as farmers on several occasions protested the price. Cotton lint is among the country’s key agricultural export commodity which includes tobacco and fresh produce.
Lands, Agriculture, Water and Rural Resettlement Minister Dr Anxious Masuka said the Government would come up with the producer price before the planting season to help farmers and contractors plan.
“I want to promise that . . . We will announce the cotton price for this season as a pre planting plan,” Dr Masuka told farmers at a recent cotton inputs launch event hosted by Cottco in Chinhoyi.
Analysts believe such a move would encourage commercial farmers to produce the crop largely grown by small-scale and communal farmers.
The majority of these farmers are sponsored by the Government under Presidential Inputs Scheme.
“Pre producer price is very important since farmers would know what they would be chasing,” Henry Doronzwa, an analyst at a local research firm said.
“This will open up the sector to many potential self financing farmers as they would have an idea of what they would get.
“But this price should be pegged in foreign currency even if farmers will get paid in local currency at the official rate for certainty. “
Zimbabwe’s cotton output peaked at 352 000 tonnes during 2011/12 season as farmers planted bigger hectarage on the back of a good price a year earlier.
Unfortunately, prices crushed during that season due to an oversupply of the commodity.
Meanwhile, Dr Masuka challenged the cotton industry to look at funding models that would allow the participation of private players other than Cottco.
However, this would require strict enforcement of regulations to reduce risks associated with side marketing.
The industry almost collapsed due to rampant theft of contracted cotton by unscrupulous non-indigenous merchants.
This resulted in support levels drastically declining.
For instance in 2014, funding dropped to US$22 million from US$42 million in the previous season as contractors scaled down on funding fearing they would fail to recover their investments.
The opening up of the industry to unscrupulous foreign merchants destroyed cotton quality, grower viability, inputs investment and ultimately a drastic reduction in the size of the cotton crop.
In 2015, production declined to 28 000 tonnes, the lowest in nearly two decades. However, the launch of the Presidential Inputs Scheme for small-scale farmers and vulnerable households helped production expand to 144 000 tonnes in 2018 before dropping to 74 000 tonnes due to drought.
This year, output is expected to slightly increase to 80 000 tonnes but lower than a target of 100,000 tonnes and this again is due to poor rains.
Cotton plays a significant role in uplifting people’s lives and is a crop that can help the nation in the fight against poverty.
This post first appeared on Business Weekly