Agriculture and Livestock Minister Given Lubinda announced the reduction in mealie meal prices in Lusaka today at a media briefing.
Mr Lubinda says the wholesale price of a 25kg bag of breakfast will now be K61.00 from K65.00 while a 25 kg bag of roller meal will now cost K44.00 from K52.00.
Mr Lubinda said the reduction in mealie meal prices follows consultations with relevant stakeholders.
Below is the full briefing
I wish to inform the nation that as minister of agriculture and livestock, I have over the past few days held consultative discussions with stakeholders in the agriculture sector concerning the price of mealie meal as well as the issue of availability of wheat in the country.
Firstly, I wish to inform the nation that Zambia has sufficient stocks of maize to meet the country’s national requirements. As you may recall, the country produced a record 3,350,000 metric tonnes of maize in 2014, resulting in a maize surplus of 1,152,505 metric tonnes.
The country still has sufficient stocks of maize to meet domestic requirements with a significant surplus for export. The Food Reserve Agency has a total of 1,281,000 mt of maize stocks. The private sector also has over 156,000 metric tonnes of maize stocks. Therefore, the current mealie meal prices are not as a result of insufficient stocks of maize in the country but rather are a result of other production related factors such as:
1) The purchase price of maize;
2) The cost of milling;
3) Transportation, logistical and financing costs; and
4) Regional demand and supply forces amongst Zambia’s neighbours.
What is government doing to stabilize mealie meal prices?
1. Government, through the Food Reserve Agency, will continue to make available maize to the private sector at a price of k76 per 50kg bag; and
2. Following consultations between government and the milling industry, millers have agreed to maintain the wholesale price of mealie meal at a maximum of k61 per 25kg bag of breakfast meal along the line of rail. Government commends those millers who are already selling mealie meal at a wholesale price lower than k61 per 25kg bag of breakfast meal and we urge these millers to continue with these prices;
3. The wholesale price of roller meal will not exceed k44 per 25kg bag;
I wish to emphasize that k61 per 25kg bag of breakfast meal and k44 per 25kg per bag for roller meal is not a uniform price but rather a maximum price. Further, I would like to appeal to our retailers across the country to stick to the recommended retail margin of k3 per 25kg bag for both roller and breakfast meal. The retailers must pass on the benefit of this reduction to the consumer. I am aware that some retailers have in the past not passed on price reductions to the consumer.
In order to enjoy the benefit of this intervention, I am encouraging consumers to purchase mealie meal from milling company outlets, where these exist, as well as other establishments that stick to the recommended retail margin.
My ministry will continue to monitor the situation regarding the issue of mealie meal prices in order to ensure that the benefit of the reduction in mealie meal prices is passed on to consumers.
Wheat imports
The nation will recall that my ministry did release the 2013/2014 crop forecast survey figures which indicated that the country would experience a deficit in wheat production.
My ministry has subsequently held discussions with stakeholders in the wheat industry, namely the Zambia national farmers union, millers association of Zambia and grain traders association of Zambia. The aim of the discussions have been to achieve consensus on the wheat situation. Although wheat production in Zambia has increased over the past five years, demand for wheat has also been increasing both locally and in neighbouring countries. The result is that local wheat production for 2014 will not be sufficient to meet our requirements as well as export requirements to neighbouring countries.
The projected wheat deficit between april and august this year is 150,000 mt. Millers have indicated that they want to import 117,500 mt of wheat.
In order to ensure continued availability of wheat in the country, I have, therefore, taken the following action:
1) Private sector wheat imports will be allowed into the country;
2) Government shall for now, allow only 75,000 mt of wheat to be imported into Zambia; and
3) The cut-off date for wheat imports shall be 31st august, 2015 after-which no more imports will be allowed into the country.
I wish to assure consumers that they will not experience any shortage of wheat products. By allowing imports of wheat, it is our view that bread prices will reduce. I further wish to reassure our farmers that government will strictly monitor wheat imports so as not to allow the significant growth in local wheat production that the country has achieved so far to be threatened by over importation. Zambia has become a net wheat exporter and I wish to encourage our farmers to continue investing in increased wheat production.
I thank you all.
HONOURABLE GIVEN LUBINDA, MP
MINISTER OF AGRICULTURE AND LIVESTOCK
Cheers
This is good for the poor zambian though a permanent solution is needed such as speedy establishment of milling plants in all provincial centres by the government.This will not only influence pricing of the commodity but also create employment.
Chagwa agwesa Kwacha bane. Malawian Kwacha is on the rise while Zambian Kwacha is falling.
Just last week Malawian Kwacha gained from K656 per £pound to K635 per £pound. Remember Malawi never rebased their money. If you rebase it just like Zambia did, then Malawian is currently at K0.635 (Rebased) to a £pound.
So is this so called PF ‘s global trend is not affecting fellow poorer neighbour with less resources than us?
Why Malawian Kwacha doing fine compared to Zambian Kwacha?
Answer:
Malawi is in capable hands of a professional lawyer who has surrounded himself with people who know what they doing. His government is the smallest in Southern Africa despite Malawian population being 16million, 2million larger than Zambia.
Lungu’s team is to blame for all this mess. PF…
Ok good move, but gwesani dollar kaili. Other wise your price drop initiative will be temporal because you have not dealt with the root causes of price hikes.
This what I call tinkering on the edges or just price controls of the socialist UNIP era.
Well its better than nothing as long as the government will pay the millers for the short fall.
i dont see any change..RB’s time it was K35 per 25kg of breakfast and you are still almost double and you say the price has reduced..these minions bazatipaya na njala…
This reduction is welcome. However, it is too marginal for it to have an impact on the ordinary person. Mr Minister please address the real issues,
1. cost of production of grain is too high
2. the kwacha is too unstable for sustainable price reduction for a country which still heavily depends on importing machinery
3.marketing of maize should be well handled, to allow for sustainable production of grain
4. How does the country position itself to export the maize in a more profitable manner
5. Price controls never work for a sustained time
This price is just wholesale. The retailer gets the last say before the poor customer pays
Price controls on commodities are a sign of bad economic decisions and poor policies.
A PERMANENT SOLUTION IS TO QUICKLY ESTABLISH STATE-OF-THE-ART OR MODERN MILLING PLANTS FIRST IN ALL PROVINCIAL HQs AND OUTWARDLY IN ALL PROVINCIAL TOWNS. AND THE EFFECT OF THIS IS EMPOWERING FARMERS WITH MORE MARKET AND A TRIGGER IN MORE MAIZE PRODUCTION ALLOVER THE COUNTRY. AND MAIZE MEAL WILL BE EXPORTED ABROAD FROM THE NEAREST MILLING TOWN RATHER THAN LUSAKA. MORE JOBS CREATED AND IMPROVED LIVING STANDARDS. IN FACT PROVINCIAL MILLING PLANTS CAN BE ESTABLISHED I ALL PROVINCIAL HQs BEFORE 2016.
Way to go bwana Minister. Mwanalume ni pamala mukwasu. 2016 you still have my vote!
What do the millers say? This price reduction should have been announced by the heads of the industry, the Millers Association of Zambia and not the Government. Does GRZ own milling companies? Government should not go into milling but should provide incentives for the private sector to invest in provincial headquarters and other productive centres such as Mbala, Kaoma, Katete, Lundazi, Mulobeszi etc. This idea of the government wanting to compete with the private sector in areas where the private sector is best suited is counterproductive. Let us not kill private sector growth. What we need is a combination of incentives and regulation to direct the private sector and not to crowd them out by building inefficient state-owned firms which which will start depending on tax payers’ money.
Say it like it should sink into the thick skulls of Government officials!
To hell !! What is K3? It can’t even buy bread !
I can hear the whispers of price controls!!!! The Zimbabwe model should not be replicated in Zambia. We know the reasons why. The PF Government is already doing the needful to reduce the high cost of production reflected in high mealie meal prices: infrastructure development!!! That is the way to go, please. Do not divert tax payers’ money to subsidies please. Reduce the cost of doing business. Ask economists and business people who know what these are.
This movie looks familiar. Anyway us donkeys live long.
In the midst of a weakening Kwacha, I do not think that millers will actually reduce the price of mealie meal. It does not make any economic sense. I will wait to see this reduction come to pass but I bet, millers will not comply.
On another thot: since the Kwacha is giving us challenges and Zambia seems to be like a province of RSA in terms of business, why can we not just adopt Rand as our official currency and forget about this worthless Kwacha? It will make business btwn Zambia and RSA very easy.
MR.LUBINDA COULD KINDLY REDUCE THE FOLLOWING AS WELL.
1.TRANSPORT.
2.RICE PRICES
3.SUGAR
4.SCHOOL FEES ETC AMEN.
This idio.t, doesn’t he know that even with these cosmetic reductions mealie meal still remains unaffordable to so many people? These stup.id foo.ls must stop taking us for a ride. What reduction is he talking about here? The fact is mealie meal is still above K50, and how many people can easily afford at this price? We have been condemned to poverty by these greedy goons. How else can we call them when Kambwili, with no shame, is appointing friends and relatives to the boards? The kwacha is plummeting and there seems to be no solution in sight. What sort of team do have leading this country; are they from Mars or what? They seem not to be concerned at all as long as they are looting our hard earned tax-payers money. God help us.
But they are not importing maize.
So what is the fuss
In-fact. PF should import Mealie meal or find one miller where FRA should meal the maize to supply retail sites.
This will put all the millers selling at exorbitant prices go out business.
This is the problem of killing imports at expense of so called buy local.
Imagine Mealie meal in Zimbabwe is cheaper than Zambia. Why because Grain Marketing Board (GMB) same as FRA buys maize but in addition it has milling companies dotted across the country competing with private millers. Private millers in Zimbabwe are pushing to limit the role of GMB to just buy so called strategic stocks so that they can exploit consumers. Difference is that RGM is practical not a the array of foolish and theoretical economists we hear of in Zambia.
So, we are back to price controls!
Does this Govt. want to takeover milling companies from the private sector?
New econimic policies indeed!
So, price contrls are back!
Does this Govt. want to take over milling plants from the private sector?
New economic policies indeed!
mealie meal is still a scarce vital commodity to many zambians. majority zambians acquire it at pamela level of packaging to which this reduction is nothing but a mockery to agric economics. lubinda has inflated ego as dora puts it. a real reduction should aim at beating the then rb’s k35 per 25kg. this means a pamela should sell at k1.5 ngwee than is the current case at k5.
What is the job of FRA? From my little knowledge, FRA acts as middle men between farmers and millers. If that is the case, doesn’t the use of FRA (government) as middle men increase the cost of maize? And considering Zambia is a free market, why would Government be the one to reduce price of mealie meal? Just asking. Again, am not familiar with the work of FRA.
I thought in a free market economy prices should be determined by market forces? In Zambia under PF government prices of commodities are being determined under the weight of political forces. Interesting.
In-fact. PF should import Mealie meal or find one miller where FRA should meal the maize to supply retail sites.
This will put all the millers selling at exorbitant prices go out business.
This is the problem of killing imports at expense of so called buy local.
Imagine Mealie meal in Zimbabwe is cheaper than Zambia. Why because Grain Marketing Board (GMB) same as FRA buys maize but in addition it has milling companies dotted across the country competing with private millers. Private millers in Zimbabwe are pushing to limit the role of GMB to just buy so called strategic stocks so that they can exploit consumers. Difference is that RGM is practical not a the array of foolish and theoretical economists we hear of in Zambia.
Given, where were you when Chenda & Bashi Nono tried this, come on…we’ve watched this movie before. Boring!
With this free fall in kwacha. Expect a rise in fuel prices or shortages of the commodity. Tiye noyo PF.
This is another 2% fuel price reduction – FOR COSMETIC PURPOSES ONLY!!!
A car with a broken engine cannot be fixed by washing the car so it looks smart!
Government needs to address the CAUSE of the disease, not just treat the symptoms.