Millers bemoan lack of credit lines for wheat, rice imports

THE milling industry has raised concern over the omission by Finance minister Mthuli Ncube of long-term credit facilities for importation of wheat, rice and salt, which they say are key in averting food shortages in the country, in the 2019 National Budget.

BY VENERANDA LANGA

Grain Millers’ Association of Zimbabwe chairperson Tafadzwa Musarara yesterday told members of the Parliamentary Portfolio Committee on Industry that nostro support to the milling industry was imperative as the country is still importing flour.

Bread prices recently went up from 90c per loaf to $1,40 due to distortions in exchange rates and foreign currency challenges.

“The milling industry has been getting support from the Reserve Bank of Zimbabwe. In respect of nostro support, however, we expected an indication (from 2019 budget) of long-term credit lines to fund the purchase of imported wheat, rice and salt, and further, we expected to see policy direction in the amortisation of the grain foreign legacy debt,” Musarara said.

“We expected the budget statement to make pronouncement on the Grain Marketing Board producer prices of the wheat recently harvested because farmers are asking for a price of $730 per metric tonne, against a buying price of $310 per metric tonne.”

Zimbabwe produces 120 000 metric tonnes of wheat annually, while consumption stands at 42 000 metric tonnes per month.

Locally produced wheat was only good for biscuits and buns, but not bread, Musarara said.

“We still need to import 350 000 metric tonnes of wheat annually because local wheat is not good for bread,” Musarara said.

He also told MPs that given the sensitivity around the pricing of staple food, there were expectations that Ncube would give counsel in respect of ceilings on key cost drivers of food prices such as labour, electricity and water charges.

Musarara said the country was also experiencing generational dietary challenges, where the youthful population was fast migrating towards consumption of rice and wheat flour.

“Imposition of value-added tax in foreign currency on pasta importation will affect the availability of pasta on the market, consequently disrupting the diets of several households and boarding schools.”

He said there was need for input support to farmers to sustain grain and cereal production in the country in order to realise food self-sufficiency.

“Currently, banks and private players are owed more than $500 million by farmers, largely due to inputs abuse, side-marketing and poor yields. These vices must be criminalised and lengthy prison terms must be imposed to give a deterrent effect,” Musarara said.

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