Farmers should target export markets

Tapuwa Mashangwa

THE welfare of mankind all over the world is affected by the stability of the global economy.

Food is one of the basic needs and once the efficiency and effectiveness of food production is affected then prices of agricultural produce should go up in a perfect economy.

If prices do not go up the farmer usually becomes the biggest loser in the food supply chain.

Over the past four months the prices of agricultural inputs have spiralled drastically in Zimbabwe making feed, fertiliser, machinery and equipment unaffordable for most farmers.

It is advantageous that Zimbabweans can buy some agricultural inputs duty free from neighbouring countries.

However, where is the non-exporting farmer supposed to obtain their foreign currency? Buying it on the black market can lead to a jail sentence of 10 years.

Salaries over the past four months are still unchanged meaning the average Zimbabwean citizen cannot afford or struggles to buy most agricultural produce (crop and animal) and would not afford them if they went up to tally with the cost of agricultural inputs.

Already a number of people have stopped buying meat, which went up to $15/kg and could still go up.

One cannot predict how the economy will be functioning in three to six months’ time, a predicament that makes efficient agricultural financial planning a daunting task.

The bond cost of production written today on a financial plan may not be the same tomorrow. So, how does the farmer progress in this environment?

The agricultural chain involves many players: farm labourers; seedling suppliers and sellers; poultry chick and livestock sellers; fuel suppliers; feed, fertiliser and chemical (antibiotics, disinfectants, herbicides, fungicides, vaccine) producers and sellers; machinery and equipment manufacturers, distributors and sellers; agri-product processors and packagers and the customers who will buy the produce. We are all a part of the chain.

In the current environment the best way to farm would be for farmers to be involved in collective farming; increasing participation in supplying the export market with produce and for our Government or foreign governments to assist the Zimbabwean agricultural sector with a subsidy fund to keep farmers afloat.

According to Joss Rose, an economist, collective farming is when a group of farmers pool their capital, land, domestic animals, and agricultural implements, retaining all as private property enough only for the members’ own requirements.

The profits of the farm are divided among its members.

Farming in such a manner permits especially indigenous farmers facing capital shortages to be able to produce crops/animals by utilising their combined funds and market penetration becomes easier as they have a larger pool of market data, advice and expertise for their production and supply process.

A company can be registered for this purpose and Memorandums of Understanding can be mutually agreed and signed to clearly define company administration, functionality and profit and loss sharing.

Targeting exports markets would assist farmers obtain the much needed foreign currency and simultaneously keeping them afloat.

Sadly most farmers are unwilling or unable to comply with foreign market contract farming requirements and if foreign capital was available that required collateral many Zimbabwean farmers would still not be able to secure funding.

When the economy was stable many failed to obtain local capital due to various reasons.

Obtaining exact data on foreign markets is a generally tedious affair and most farmers fail before they even start research.

Only when farmers desire and strive to be commercially and financially productive can they participate in supplying foreign markets.

It is a worthy affair.

If the Zimbabwean agricultural markets were stable or if stability is attained especially when it comes to prices it would be quite plausible for our Government or foreign governments to assist our agricultural sector by subsidising farmers.

With the current performance of the economy, agricultural subsidies would go a long way is boosting production.

According to Investopedia an indigenous or foreign subsidy for agriculture is a government incentive paid to agribusinesses, agricultural organizations and farmers to supplement their income, manage the supply of agricultural commodities and influence the cost and supply of such commodities.

Such a facility can only be available and functional if the economy and the indigenous market is stable.

Our economy once fell and rose, and it will rise again.

Hilary Hinton “Zig” Ziglar, an American author said, “When you catch a glimpse of your potential, that’s when passion is born.”

The moment passionate Zimbabwean farmers truly realise, acknowledge and decide to capitalise on the financial value of our land, our agricultural sector will truly boom.

– The writer is Engineer Tapuwa Justice Mashangwa, CEO Emerald Agribusiness Consultancy located in Bulawayo. He can be contacted on +263 771 641 714 and email: [email protected] <mailto:[email protected]>