Farmers demand US$ payments for grain

LIVINGSTONE MARUFU

 

Farmers are demanding to be paid in US dollars amid indications that input prices have astronomically risen, it has emerged.

Zimbabwe Farmers Union secretary general Paul Zakariya told Business Times that the delay in farmers’ payments has caused the farmers to stampede on inputs resulting in price increases due to huge demand.

“There was an increase in input prices over the past few weeks and it is very normal for the farmers to demand US dollars for their produce to continue with production. As it stands right now farmers are at a precarious position as they were paid late in local currency at a time when the exchange rates have spiked, forcing farmers to buy limited seeds and fertilisers,” he said.

During the post cabinet briefing, Information, Publicity and Broadcasting Services minister Monica Mutsvangwa said a total of ZWL$1.5bn was received from the Treasury last week and cumulative receipts now amount to ZWL$33.03bn.

Grain delivered to date is valued at ZWL$34.99bn giving an outstanding balance of ZWL$1.96bn.

These outstanding balances affect farmers’ planning as input prices continue to soar  and by the time when the farmer tries to utilise money, he or she will buy less.

Zakariya said if the farmers were to be paid in the local currency there is need to observe prices on the global market and keep up with inflationary movement on the market especially the black market rate.

Some farmers said the government should peg the maize price in forex terms and at import parity.

Farmers argue that they buy most of their inputs in US dollars hence should be paid using the same currency.

Last year, maize price was reviewed four times but farmers delivered 450 000 tonnes to the marketing board causing the government to spend US$504m on imports.

Agricultural experts believed that a higher maize producer price would lure most farmers to sell their maize to GMB.

Grain companies like National Foods, Alpha grain and Agrifoods among others preferred  the government to use import parity prices to avoid arbitrage opportunities.

Agriculture analysts believe that this year the country could use more forex to import given that some countries were affected by excessive  rains. Zimbabwe requires 2.1 tonnes of grain yearly against a total output of 3.1 attained this year courtesy of good rainfall patterns.

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