(REUTERS) Lack of funds may threaten Zambia's maize reserves

Lack of funds may threaten Zambia's maize reserves
Sat 31 May 2008, 12:21 GMT
By Chris Mfula

LUSAKA (Reuters) - Zambia's strategic maize reserves could be under threat this year as the government does not have enough money to buy sufficient stocks, a senior official said on Saturday. The state run Food Reserve Agency (FRA) would buy only 80,000 tonnes of maize compared 415,000 tonnes last year, FRA Chairman Costain Chilala told Reuters. Chilala said the government would give the agency $22.8 million, down from last year's $68.5 million, but might allocate more funds later.

"If we are not given additional funding, it means we will close next year with 150,000 tonnes of maize in reserves but we need to have at least 350,000 tonnes," he said.

The FRA, which manages the National Food Security Reserve, purchases grain at the start of the season for release at market value if the private sector is unable to meet demand.

"We hope that the government can give us more money so that we can buy at least 400,000 tonnes of maize because that will enable us to build reserves to 350,000 tonnes by December," Chilala said, adding the agency would not borrow from banks.

Total maize production in the 2007/08 season is established to be 1,211,566 tonnes down from last year's 1,366,158 tonnes.

Each farmer would be allowed to sell a maximum of 222 by 50 kg bags of maize at $13 per bag compared to $11 last year.

Zambia National Farmers Union executive director Songwayo Zyambo told Reuters in an interview small-scale farmers would likely be at the mercy of private traders this year.

"We are going to support the calls by the FRA calls for additional funding from the government because we do not want unscrupulous traders to exploit the small-scale farmers in remote areas," Zyambo said.

Industry officials have placed total national requirement of maize at an average of 1.2 million tonnes for food, the brewery and stock feed industries.