Zimbabwe’s edible oil companies are accessing US$8m weekly on the foreign currency auction system from the previous US$2m per week, a move which has averted a shortage of cooking oil, an industry executive has said.
“We now have eight cooking oil firms in our association with each member accessing US$500,000 each week. This move is expected to improve production levels in the cooking oil industry,” said Oil Expressers Association of Zimbabwe president, Busisa Moyo.
“We would like to thank the Reserve Bank of Zimbabwe for reducing the forex payment backlogs to around three weeks from nine weeks as the country moves to improve cooking oil production.”
He said the situation on the ground has improved, although the RBZ should move to clear the backlogs within a week.
The country needs 2m litres of cooking oil per week and with the central bank supplying US$8m per week the country could see itself producing up to five million litres.
Moyo said oil expressers are not yet producing to capacity as they are yet to access their money from the central bank.
“We are in discussion with the monetary authorities and we are confident that we will soon pay our telegraphic transfers (TTs),” Moyo said.
Zimbabwe harvested about 72 000 tonnes of soyabean in the just ended summer cropping season.
But, the country’s cooking oil companies use about 20 000 tonnes a month, meaning what has been harvested was to last for only three-and-a half months.
The situation has been worsened by the increase in crude oil prices on the international market by 60% to US$1650 per tonne in recent months from US$1000 per tonne in December last year.
The average level of capacity utilisation for the cooking oil industry has halved to about 20% in March from the December levels owing to critical shortage of raw materials and subdued demand, players in the sector said this week. Recently, the government pegged the price of soya beans at ZWL$48 000 per tonne.
Moyo said there was a need for a review of the price.
According to findings of the first round of the Livestock and Crop assessment conducted by the Ministry of Lands, Agriculture, Fisheries,
Water and Rural Resettlement, soyabean hectarage was 136% up to 79,359 hectares during the 2020/21 summer cropping season from 33,599 hectares planted in the prior season.
Plans are underway to increase the soyabean hectarage during the upcoming summer cropping season to reduce dependency on importation.
Zimbabwe will fork out over US$72m on crude oil imports between June and December.