National Foods Limited (NFL) plans to increase its maize meal output to 14 000 tonnes per month by year end as demand for locally manufactured goods continues to grow.
In 2010 maize meal production at the company averaged 6 200 tonnes per month and has since risen to the current 9 500 tonnes per month.
Speaking to journalists during a media tour of its Harare plant, NFL managing director Chipo Nheta said the introduction of import duty on maize meal was long overdue as duty-free was making it difficult for the company to plan ahead.
Nheta said the duty-free regime that had been prevailing was “killing” local production as millers from Zambia, Malawi and South Africa had lower operating costs compared to their Zimbabwean counterparts and as a result local products were not competitive.
“We were killing our own food security while we were protecting consumers. In the long run we were going to float,” he said.
However, the re-introduction of duty on selected items has resulted in an upward increase in some prices of basic commodities.
According to statistics from the Ministry of Finance, the price of mealie-meal has gone up by 22cents.
Nheta said NFL had no intention of adjusting its prices upwards given that import duty was had been introduced.
Commenting on the proposed 31% electricity hike that is set to take effect on September 1, Nheta said the company had no intention of passing on increases to consumers.
“It’s a steep increase. However, if we continue to have the right volumes we may be able to absorb the cost. I am sure it will depend on the volumes,” said Nheta.