Online Reporter
Edgar Vhera, Zimpapers Business Hub
COTTCO has so far bought cotton worth over US$3 million with farmers getting their payments in foreign currency.
The company has resorted to using plastics for packaging instead of the traditional wool-packs.
Cottco acting chief executive, Mr Rockie Mutenha said plastics were more affordable and locally made unlike the wool packs which were imported from India.
“We have bought over US$3 million worth of seed cotton across the country at the grade D price of US$0,30 per kilogramme. As a result of the drop of US$0,02 in grade D price from US$0,32 per kilogramme for last year, we are paying our growers 100 percent in foreign currency,” he said.
Farmers were this season supposed to get 70 percent of their payments in foreign currency and the remaining 30 percent in local currency.
Cottco and other merchants appealed to Government to allow them to pay the whole amount in hard currency due to the drop in international prices.
Mr Mutenha said some common buying points had no wool packs and were issuing plastics instead.
“It takes two to three months to get delivery of wool packs if ordered from India,” he said.
Mr Mutenha said the imported wool packs could delay and were also expensive as they cost around US$9 before value added tax (VAT.
He said the main purpose of the wool packs was conveying cotton from field to ginneries, a function equally performed by less costly plastics.
“Some countries are using plastics, which have an advantage of being cheap as well as being manufactured locally. By using plastics, we are saving foreign currency from imports and creating employment to local manufacturing companies,” he said.
Cottco has temporarily been restricted from moving cotton from buying points to their ginneries as they still owe AMA some money from levies collected in some past seasons.
Mr Mutenha said negotiations for the release of the license for them to move their produce and start ginning were at an advanced stage.
Cottco contracted 109 362 hectares and is expecting not less than 60 000 tonnes of seed cotton.
From the over US$3 million purchases Cottco has so far bought over 10 million kilogrammes of cotton, about 17 percent of their target.
Meanwhile, statistics released by AMA dated June 27 show that five of the six registered merchants had bought 2 989 572 kilogrammes of the crop valued at US$896 872.
Cottco accounts for 48 percent of the sales with 1 436 005 kg, followed by Alliance Ginneries on 515 665kg and Agri Value Chain at 414 023kg.
Southern Cotton is on forth position with an intake of 398 413kg and lastly Zimbabwe Cotton Consortium on 5 588kg. Cangrow had not purchased anything by the 27th.
