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Judith Phiri, Business Reporter
ZIMBABWE Stock Exchange (ZSE)-listed agro-industrial firm, Tanganda Tea Company Limited’s products recorded significant growths in the export market as their diversification strategy continues to pay dividends.
The company which successfully listed on the ZSE in February this year, following its unbundling from Meikles Limited, has invested in four key value chains, namely tea, macadamia nuts, avocados and coffee.
In its financial statements for the 12 months ended 30 September 2022, Tanganda said the strategy of diversifying operations has yielded tangible benefits and will continue to be a focus in the coming years.
The company revealed that its exports of coffee, bulk tea and avocado fruit increased by 14 percent, 11 percent and seven percent respectively.
“Coffee exports of 96 tonnes were 14 percent above 84 tonnes achieved in the prior year. Average export selling price of US$6,56 per kg remained slightly firmer than prior year price of US$6,50 per kg.
“Bulk tea exports grew by 11 percent to 7 125 tonnes from the prior season’s 6 392 tonnes. This was despite tea production volumes of 8 670 tonnes being 6 percent lower than prior year of 9 179 tonnes due to the dry weather patches experienced during the agricultural season. The average export selling price firmed up slightly to US$1,42 per kg from US$1,39 per kg in the previous year,” said the company.
“Avocado fruit exports grew by 7 percent from 4 001 tonnes in the prior season to 4 268 tonnes. However, the average export selling price of US44 cents per kg was 38 percent lower than US 71 cents per kg in the prior year as a result of the oversupply on the European market by Peru, compounded by the Covid-19 pandemic that reduced volume uptake by the European hospitality sector.”
Tanganda said as the world moves out of the Covid-19 pandemic, they expect that both export volumes and selling prices of avocado fruit will firm up.
The company said 49 additional hectares which were 43 hectares prior year of avocado plantation were established during the financial year bringing the total hectares under avocado to 497 hectares.
Tanganda added: “Packed tea volumes into the regional market recorded a 57 percent growth from 218 tonnes in the prior year to 343 tonnes. Overall packed tea sales volumes of 1 994 tonnes were 9 percent below 2 191 tonnes in the prior year.”
It said logistical delays arising from global supply chain disruptions resulted in a lower local packed tea order fulfilment percentage especially in the peak winter season but this has since improved significantly.
The company said liquidity challenges affecting disposable income in the economy further impacted the level of sales volumes and during the fourth quarter, they introduced Makoni, Resurrection and Rosella herbal infusions onto the market in response to customer preferences.
In terms of macadamia nut production, Tanganda said of 1 076 tonnes was nearly equal to last season due to dry weather experienced during the season.
“The macadamia market is shifting to kernel from the traditional nut-in-shell market, resultantly exports declined by 16 percent from 800 tonnes in the prior year to 670 tonnes. Global prices of nuts declined from an average of US$5,12 per kg achieved in the prior year to US$3,26 per kg in the current year.”
The company said to mitigate these developments, it has identified alternative markets and strategies that include exploring value addition options.
Tanganda said it remains committed to its sustainability agenda, with three solar plants constructed at three of the five estates.
“These have reduced reliance on electrical power from the national grid and on diesel generated power thereby reducing carbon emissions. Further benefits from the investment are expected to be fully realised once full reticulation and net metering have been implemented in the coming financial year,” added the company.
It said modern precision irrigation installed in the avocado and macadamia plantations ensures efficient usage and conservation of water.
derick.khumalo
Online Reporter