Farmers’ indaba on the cards

Farming Reporter
AT least 500 delegates are expected to converge in Mutare for the 75th edition of the Zimbabwe Farmer’s Union Annual Congress which will review the performance of the agriculture sector as well as preparations for the 2015/ 16 cropping season. The congress — which will be attended by the union’s district, provincial and national leaders, private sector players, development partners and Government officials among other stakeholders, kicks off on September 2, 2015.
The congress will be held under the theme: “Value Addition: Foundation For Wealth Creation”.

The ZFU Annual Congress is an effective platform for farmers and key agriculture stakeholders to meet and exchange ideas and views on agriculture policy and value chain issues.

ZFU executive director, Mr Paul Zacharia, said the congress would discuss challenges confronting the agriculture sectors such as funding, extension and knowledge gaps and the need for training to improve the quality of agro-products.

“We are meeting as stakeholders to review the performance of the sector in the 2014/ 15 season and make projections for the 2015/ 16 season. We will be looking into the issues that affected agriculture last season and make recommendation to influence policy to ensure a better approaching season,” said Mr Zacharia.

Some of the challenges that affected agriculture include poor tobacco prices that stagnated at an average of $2,96 per kg. The prices were subdued by seven percent when compare to the previous season average price of $3,18.

The majority of Zimbabwe farmers have converted their maize field to tobacco due to its perceived quick returns on investments when compared to other crops, but genuine fears now abound that most of them, especially resource poor small-scale ones have been pushed out of the farming business and may not be able to return to the field after getting a raw deal at the auction floors.

The farmers were bitter that farming was a business and their hopes of getting a return of their investment were extinguished due to price distortions at the auction floors which resulted in them racking up huge losses.

The congress will also look into challenges being encountered by small-scale tobacco farmers with contractors amid revelations that the latter were not renewing contracts of farmers who failed to clear their debts.

The other challenge was non-availability of lines of credit and the high cost of money.
Mr Zacharia said his organisation was lobbying Government to come up with policies favourable to farmers to enhance productivity on the farms.

Mr Zacharia said the latest move by the Reserve Bank of Zimbabwe to direct banks to lower their interest rates, which currently go as high as 30 percent, with effect from October 1, was a result of their lobbying.

The guidelines, revealed in a Monetary Policy Statement recently issued by RBZ governor, Dr John Mangudya, apply on existing and future lending.
“In view of high interest rates currently obtaining in the economy, there is scope for reduction to ensure that lending rates are supportive of economic recovery,” the Central Bank governor said in his statement.

“Within the broader policy to streamline costs of doing business and stimulate economic activity through affordable credit facilities in the domestic banking system, the following interest rate guidelines . . . have been agreed between the Bankers Association of Zimbabwe (BAZ) and the Reserve Bank.”

In terms of the interest rate framework, lending to productive sectors would range from 6 percent to 18 percent per annum, depending on the borrower’s risk profile.
“The downward review in bank charges and interest rates are envisaged to achieve the key objectives of stimulating aggregate demand, promote the resuscitation of industry, improve the cost of doing business and support sustained economic growth and development and thereby going beyond stabilisation,” Dr Mangudya said.

Mr Zacharia said the agreed interest rate guidelines should also act as an incentive for farmers to timely service their loans, improve their risk rating and access cheaper financing from banks.

He said the interest rate structure is expected to benefit both banks and the farmers.
“We will continue influencing policy and the congress will come up with recommendation for consideration at the highest level in Government,” said Mr Zacharia.