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Business Reporter
Stakeholders in the cotton industry have recommended a minimum producer price of US34c per kilogramme during the 2025 selling season, up from US32c the previous season, according to people with knowledge of the matter.
The stakeholders, who include farmers and merchants, have since forwarded their recommendation to the Government for approval.
“At a recent stakeholder meeting, we agreed to set the minimum price for seed cotton at US34c per kg (Grade D), and we are now waiting for approval from the Ministry (of Lands, Agriculture, Fisheries, Water, and Rural Development),” said one person who chose to remain anonymous due to protocol issues.
“The negotiated price was arrived at by consensus, ensuring that farmers are reasonably rewarded without compromising the viability of the merchants.”
Another person said additional payments would later be made as top-up payments for higher grades.
Farmers initially receive payments for the lowest grade (D) on delivery, with subsequent top-up payments based on the final grade.
Last year’s El Niño-induced drought severely impacted crop production, including cotton, which plummeted to a record low of 13,000 tonnes.
However, hopes are high for the upcoming season, with the anticipated La Niña weather pattern promising better rainfall.
Cotton is a major agricultural export commodity that benefits various sectors, including the textile industry, stockfeed, and edible oil production. At its peak, Zimbabwe produced 351 000 tonnes in the 2010/11 season.
The total cost target of production is estimated at US$48,1 million this year, with the private sector financing 33 percent, being 90 000 hectares, according to the Government 2024,25 Summer Plan.
For Pfumvudza cotton, the target is to plant 180 000ha. Two plots each of 0,25 ha per grower will be required to access inputs.
Industry players have since called for stakeholders to adopt a more realistic approach to pricing the commodity, arguing that setting excessively high prices that merchants find difficult to pay has led to significant delays in payments to farmers.
Over the past few seasons, farmers have faced the frustrating consequences of delayed payments as merchants struggle to pay the set prices.
Even when payments are eventually made, their value is often eroded by rampant inflation.
Industry experts believe that these challenges have been a major factor driving farmers away from cotton production.
To revitalise the sector, they advocate for a pricing mechanism that is both fair to farmers and sustainable for the industry as a whole.
Farmers contracted by the Cotton Company of Zimbabwe (Cottco), through the Government’s Presidential Free Inputs Scheme, have endured years of hardship, and sometimes receiving payments in the form of groceries.
Cottco sponsors 85 percent of production, representing over 250 000 households.
The company is currently implementing a transformation strategy focusing on: enhanced operational efficiencies, increased quality seed cotton production, increased value addition, increased ginnery upgrading or improved plant and equipment availability as well as improved brand management.
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