Cotton producer price set at $0.65/kg

cotton
LinkedIn

HARARE, June 5 (The Source) – The Cotton Producers and Marketers Association of Zimbabwe (CPMAZ) on Thursday said farmers have agreed to sell the crop at $0.65 and $0.70 per kg for contracted and non-contracted crop this season.

Government is not setting a producer price this season following an order from the Competition and Tariff Commission that farmers individually negotiate the buying price.

The crop, referred to as the white gold, was bought at a price of $0.35 per kg during the 2013 season although the price later shot up to $0.70 towards the end of the season.

CPMAZ chairman Clemence Gondo said members had agreed that the breakeven price for most farmers was $0.54 per kg.

“We agreed and set $0.65 as the buying price for contracted cotton after putting a mark-up of 25 to30 percent,” he said.

“But for the non-contracted cotton, the price is $0.70.”

Gondo, whose association represents over 200,000 cotton farmers, accused members of the Cotton Ginners Association (CGA) of forcing contracted farmers to sell the crop at between $0.35 and $0.40 per kg.

No comment could be obtained from the CGA, whose members are also contractors and buyers of the white gold.

Gondo said farmers were against continued use of common buying points in some areas by the buyers.

“There is collusive behaviour at the common buying points as farmers are offered low prices,” he said.

About 13 companies are buying cotton from farmers this season, the CPMAZ chairperson said.

Zimbabwe’s cotton production has slumped in past seasons as farmers shifted to tobacco because of higher prices on offer.

Output slumped to 140,000 tonnes in 2013 from 350,000 tonnes the previous year.

Government, however, estimates production will this year improve to 180,000 tonnes.

Agriculture minister Joseph Made said last week government would reintroduce the Cotton Marketing Board (CMB) to bring order in the production and marketing of the crop.

The former CMB, now Cottco Holdings, was privatised in 1994 and listed on the Zimbabwe Stock Exchange three years later.

About 60 percent of the country’s rural population is directly involved in cotton production.

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s