SeedCo Recovers 25% of Govt debt

ROBIN PHIRI

Zimbabwe’s largest seed producer, SeedCo, has recovered 25% of the US$40m owed by the Government of Zimbabwe, securing US$10m of the outstanding balance.

The development was confirmed by SeedCo Group CEO, Morgan Nzwere, who highlighted the company’s proactive engagement with authorities to recover debts.

“We’ve also managed to collect 25% of what was owing from the Zimbabwe government,” Nzwere said.

“We keep engaging [government], we keep looking at ways to expedite the collection of the remaining balance, but we are all aware of the liquidity challenges that do exist. We are grateful for that 25% we’ve collected so far, and we’ll keep engaging government to try and see how we can expedite the collection of the balance,” he added.

The recovery comes as SeedCo positions itself to capitalise on Zimbabwe’s increasingly informal agricultural trading environment—a strategy expected to strengthen revenue streams for the upcoming farming season amid reduced government participation in the distribution chain.

“We also continue to notice low disposable incomes in the economy, and we’re noticing increased informalization. So business is moving from the big retail shops and the little corner shops are sprouting up everywhere. And the customers are actually moving, following the business to these informal shops,” Nzwere said.

The initiative is particularly crucial following a 60% decrease in SeedCo’s wheat volumes, largely due to reduced government input programs and unplanted stock carryovers from the previous year.

“Some of the stocks that were sold in the prior year hadn’t been planted by farmers. We know that competitors had stocks that they were carrying as well that hadn’t been planted by farmers. And they ended up giving these stocks to farmers on season-long credit without demanding any payments upfront,” Nzwere explained.

“And we think that also affected the demand of wheat. When you look at overall volumes, 30 percent below target. But again, it’s always important to remember that the bulk of the group’s business does okay in the second half of the year.”