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Alba Iulia
Thursday, July 2, 2020

The Announced Maize Price of K 110 Is Not Cost-Reflective and Can Hurt Farmers

Economy The Announced Maize Price of K 110 Is Not Cost-Reflective and Can...

The Centre for Trade Policy and Development has observed with great concern that the recently announced purchasing price of Grain by the Food Reserve Agency is not cost-reflective and can hurt farmers.

The CTPD also notes that the current prices only highlight historic controversies associated with state intervention in agriculture.

Dr. Simon Manda, the CTPD Senior Researcher has further noted that these prices will not help to stimulate rural growth as it will erode opportunities meant to enhance rural income disbursements necessary for driving an agricultural transition, poverty reduction, commercialization and value addition.

He said these prices will discourage small-scale farmers and other rural producers to engage in agriculture.

“CTPD advised that if care is not exercised, the country risks failing to produce a stream of empowered rural producers capable of commercializing and even transitioning into diversified economic and livelihood avenues”, he said.

Dr. Manda said in addition, such low purchasing prices have the potential of depressing private sector actors who would even push their buying prices further down, undercutting what has been announced by FRA especially that the institution is associated with persisted delays in paying farmers.

He said with the growing public external debt now estimated at 11.2 billion US dollars of external debt, his Organisation is even more worried that payment towards procurement of strategic reserves may even take longer than the 5 to 6 months delays observed in the recent past.

Dr. Manda said Regional experiences such as from Tanzania have shown that it is possible to limit the extent of state intervention and stimulate private sector actors to provide competitive prices even better than is provided by our government.

He said the difference has been that the Zambian Government has been bold enough to carefully think through the benefits of private sector engagement in agriculture.

“Such efforts have seen cost-reflective prices prevail thereby expanding opportunities for local producers. In light of the COVID- 19 pandemic and the need to ensure availability of funds for the most vulnerable groups, CTPD urges Government to consider allocating part of the ten billion stimulus package recently announced by the Bank of Zambia to support procurement of grain by FRA as this will be critical in ensuring that our local farmers get their payments on the spot should they opt to sale their grain to the Agency”, he said.

Dr. Manda said this will go a long way in protecting small scale producers from the harsh economic hardships the country is currently going through.

[Read 677 times, 1 reads today]

8 COMMENTS

  1. When mealie meal prices go higher, you first ones to release your statements hitting on govt. You tuma CSOs should just shut up

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  2. Good keep advocating for farmers. Let he who complains about mealie meal prices develop spines to go farm.

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  3. Being a farmer what I can say is that the price is just fine for the small scale farmers who got the subsidized fertilizer from GRZ. But for those who bought fertilizer and inputs at market prices the price is low. This is the conundrum we have to solve. Can we find a way of identifying the subsidy beneficiaries so that they sell to FRA at its own price while those who acquired the inputs from the market have their own price….this would mean allowing them to export so as to get some profits. But what we see are export- bans always. Hence the emerging farmers will always lose in the maize farming. Please allow the emerging farmers to export their maize while FRA should buy from the subsidized farmers. Find a way of doing this.

  4. It is a free market economy. Farmers are at liberty to sell to anyone offering them a better price.
    FRA is not forcing to accept the k110 price

  5. Farming is supposed to be a business like any other so that those who engage in it make some profits that would change their families lives for better! However what we see is government intervention in this area especially when it comes to maize. The picture accompanying the article tells a discomforting story. We see the healthy pile of harvested maize cobs in front of a “home” and the harvest owner with family. Scanning the scene I wonder when this family would improve the house and let us see a better picture than what we currently are looking at! This all arises from government’s intervention through floor price setting for FRA and concern for subsidizing consumption by people in cities at the expense of economic gains for the rural areas through restrictive marketing and pricing…

  6. contd….. controls on the only commodity/produce that can bring quick homestead incomes such as for the family in the picture! @ The Advocate the CSO’s are mostly concerned with communities in high density areas in cities and they abet poverty because they too want to get it cheap in order to service their target groups and @ Rowdy I totally concur with your line of thought, why should one even complain about cost of vegetables in the market when they can grow their own? There are a lot of people in cities doing nothing tangible other than living with hope for opportunity to get a job of which promised jobs are never coming and living on subsidized mealie meal forgetting they are robbing their own relatives of deserved incomes in the rural areas! What kind of free market economy is…

  7. contd….one that maintains a grip on subsidy paid by farmers for their produce in order to subsidize consumers mostly in cities? Why not encourage those who complain of high cost of seasonally grown “food” to grow it for themselves? @ Truth Hates is the solution that government and FRA would not like to hear and even entertain! Yes! Let FRA buy from the FISP beneficiaries but we know that this grant has and will not produce the desired results for well known reasons and thus a blanket restriction limited to FRA disadvantages even farmers that make unassisted investments! Stop cheating the hard working but impoverished rural farmers out of income expectations and instead engage with the millers on subsidizing “food” for the benefit of city dwellers!

  8. Govt must dictate ZNS products becsuse its gvmnt which pays and spends on production. Leave a small scale farmer alone and open boarders like Congo and Angola for the small scale farmer to sell his produce. Mind you Zambia haas a liberized economy and not gvnt controlled economy.

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