Grain Millers Association of Zimbabwe (GMAZ) has approached the government to subsidise staple food to ensure price stability amid rising costs in the milling industry.
BY BUSINESS REPORTER
GMAZ chairman Tafadzwa Musarara said on Saturday the industry had approached government for the subsidy to be effected.
“We have intimated that to the chairman of the Cabinet committee on food security and nutrition and he has invited us to put a document which we are submitting on Monday (today) or Tuesday (tomorrow),” he said.
Vice-President Constantino Chiwenga chairs the Cabinet committee on food security and nutrition.
Musarara said the subsidy on staple food is done in other countries to arrest inflation as food contributes about 30% to the consumer index basket.
“It’s important that it is subsidised, the question is at what level: at the farming level or at millers’ level. Food is a right and every government has to ensure that its citizens have access to affordable food,” he said.
The call by millers comes at a time costs have risen sharply as the industry is importing wheat at between $382 and $390 per tonnes, which is above the $310 per tonne the sector was paying for local wheat.
The millers are also grappling with a $500 000 per month interest on a $53 million debt owed to suppliers of wheat.
The interest, combined with the high costs of procuring the wheat, has risen fears of an increase in the price of flour which will feed into an increase in the price of bread.
Musarara ruled out any price increase.
“Not at the moment. Price increase is the last resort that we will do and in the past 10 years , we have maintained the cost of mealie meal and the products that we deal in despite the inflationary pressures. At this juncture, there are serious cost issues,” he said. The sector plans to settle outstanding obligations because they have got a bearing on costing of flour due to the interest rates that they were incurring.