Imports choke Olivine

beans.
Managing director Mr Jonas Mushangari confirmed in an interview last Friday that they were struggling to sell baked beans and now has a stockpile worth US$400 000.
“Competition is stiff because our belief is that some of the (imported) products are being dumped in Zimbabwe. The real issue is that baked beans are being dumped from South Africa and it has been difficult to sell (our own). Currently, we have around US$400 000 worth of that stock,” he said.
A 500g tin of locally produced baked beans sells for US$1,15, compared with US99c for a similar imported unit.
In most cases, when the firm tries to sell its product, retailers spurn them on the grounds that they are more expensive.
Mr Mushangari said it appeared that most of the imported products being sold at prices much lower than locally made goods were not paying relevant taxes on entry. But he dismissed as inaccurate word doing the rounds that due to cut-throat competition in the local market the firm had resorted to exporting its products.  
Olivine, which is owned 43 percent apiece by the Government of Zimbabwe and AICO Africa, manufactures vegetable oils, margarines, bakers’ fats, soaps, candles, dried beans and a wide range of canned foods. Mr Mushangari said while Olivine was facing stiff competition from imported products in selling its edible oils, it remained committed to producing largely for the local market. Currently, 80 percent of Olivine’s products are sold locally, while between 15 and 20 percent is exported.
While Mr Mushangari would not discuss the situation with regards to other products in its line of business, it appears the company is facing similar challenges across the board.
Working capital constraints are weighing down Zimbabwe’s oldest fast-moving consumer goods manufacturer, although it is exporting 20 percent of its products to neighbouring countries, mainly Zambia and the Democratic Republic of Congo.
Mr Mushangari recently told a visiting South African delegation that had come for the Fourth Investment Trade Initiative that demand for Olivine’s products was high but that the company lacked working capital and had archaic equipment.
He said Olivine’s capacity utilisation was at 32 percent, and that the firm required at least US$25 million for recapitalisation.
Olivine’s shareholders, State-owned Industrial Development Corporation of Zimbabwe and AICO Africa, are looking for investors to inject the requisite fresh capital. 
Mr Mushangari said, if secured, the fresh funding would be invested in new plant and equipment, thus reducing the cost of labour.