Vusumuzi Dube
Judith Phiri, Business Reporter
LARGEST seed producer, SeedCo International has said the group has adequate seed stocks to satisfy demand across markets, while they were well prepared to respond to the needs of farmers in light of the mixed rainfall forecasts.
This comes after the group achieved significant yield and quality gains in the previous production season (2022).
In a trading update for the half year ended September 30, 2023, SeedCo International said despite enormous and largely exogenous headwinds, a mixed selling season is being anticipated.
“As a result, first-half performance was in tandem with the seasonality of the business. However, the group achieved an interim operating profit of $1,3 million, a rebound from the prior year’s $2,6 million interim operating loss,” said the group.
“Latest forecasts are indicating normal-to-above normal rainfall in most parts of East Africa, and below normal rains in Southern Africa from November 2023 to January 2024. The group is well prepared to respond to the needs of farmers in light of the mixed rainfall forecasts. A mixed selling season is being anticipated benefiting from the group’s diversified geographical footprint and a diverse climate-smart product portfolio with potential downside from unfavourable rains in Southern Africa.”
It said a combination of volume growth and a better product mix boosted revenue by 23 percent compared to the comparative period.
SeedCo International said encouraging first half maize sales were booked in Kenya, Malawi, Mozambique, Tanzania, and Zambia bouyed by firm grain prices in the region and globally.
The group added: “Improved margins and containment of overheads below the USD inflation rate also helped the business post an interim operating profit. Net finance costs increased due to higher interest rates and more local currency borrowings facilities utilised to expunge USD denominated liabilities and manage elevated foreign exchange risk from depreciating regional currencies.”
During the period under review, the group’s share of losses from associates and joint ventures increased significantly driven by exchange losses, while the net result is 8 percent better than last year’s interim net loss.
SeedCo International said as is the norm, the group’s inventory levels were at their peak this time of the year in preparation for the main summer selling season.
While, it indicated that it will continue to deliver improved products from its research and development (R&D) investment over the years.
The group said several new and improved seed varieties are being released in response to climate change and the evolving needs of our farmers.
SeedCo International, which is incorporated and domiciled in Botswana and listed on the Botswana Stock Exchange and the Victoria Falls Stock Exchange, has subsidiaries, associates and joint ventures located across Africa.
The countries include Angola, Botswana, the Democratic Republic of the Congo (DRC), Ethiopia, Ghana, Kenya, Malawi, Mozambique, Nigeria, Rwanda, South Africa, Tanzania, and Zambia.
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