FARMERS have called on the Government to uphold the time value of money on the local currency portion for sustainable agriculture production, in view of the lucrative US$ denominated pre-planting producer prices announced recently.
Zimbabwe Farmers Union (ZFU) secretary general, Mr Paul Zakariya yesterday appealed to the Government to ensure the true value of payments announced recently was maintained as farmers await the announcement of the final producer price at harvesting time.
“The local currency value needs to move in tandem with exchange rate on the interbank market to preserve farmers’ profitability to avoid deflating their zeal to produces more,” said Mr Zakariya
The Government announced pre-planting producer prices, which were set based on cost of production plus a 15 percent return on investment and benchmarked to the import parity prices. Maize and traditional grains were set at US$335 per tonne with soya beans at US$597, 59 while sunflower got US$687, 23.
“Though the announced producer prices are quite fair, more hectarage could have been put under different crop options if the Government had made the announcements earlier before the season started. This would have afforded farmers a chance to make informed decisions unlike now when they have already planted,” said Mr Zakariya.
Mr Zakariya further said there was need for prompt and full payment for produce upon delivery in order for farmers to take farming as a business and for the viability of the farming profession.
The call comes on the backdrop of an outcry from wheat farmers for whom lucrative prices of US$620 and US$682 per tonne for ordinary and premium grade were announced at the start of the season.
In an endeavour to preserve value for farmers the payment was split at 33:67 ratio between the US dollar and local currency.
Farmers were paid US$200 plus $243 680 for ordinary grade and US220 plus $268 048 for premium grade. Overtime the local currency value has been going down with the resultant implied US$ value getting small due to local currency depreciation.
Mr Zakariya observed that as much as 50 percent of wheat farmers who delivered their crop to Grain Marketing Board (GMB) have not been paid and or were partially paid adding that the Government needed to continue encouraging farmers to plant wheat next winter season.
The same fate has befallen maize and traditional grains whose local currency portion has remained stagnant since the day the profitable producer prices were announced.
Meanwhile Zimbabwe Commercial Farmers Union (ZCFU) president Dr Shadreck Makombe applauded the recently announced pre-planting producer prices saying they were even higher than what their regional counterparts were getting but called for prompt payment of farmers to enable them to enjoy the benefit.
“The announced prices which are set on import parity are good and higher than what our regional peers are getting.
“The only bottleneck is that farmers are getting paid late when the true value of the money has been eroded. There is need for prompt payment of farmers upon product delivery to preserve value of money,” said Dr Makombe.
Dr Makombe further called upon input sellers to be ethical and not to arbitrarily increase prices without any justifiable reason.
Zimbabwe Integrated Commercial Farmers Union president Mrs Mayiwepi Jiti added her voice saying it was good to announce pre-planting prices before the real planting to encouraged proper planning and budgeting.
“The announced prices will leave a farmer with a profit. The Government announced prices in US dollars and it is unlikely that it will split payments to US dollar and local currency,” she said. – The Herald
