Maravi

Experts urge caution over maize imports

Experts urge caution over maize imports
Written by Joan Chirwa
Tuesday, December 09, 2008 12:15:21 AM

ACTION taken now on the maize issue can either make Zambia a net exporter or a perpetual importer of the commodity, key industry analysts have observed.
And University of Zambia (UNZA) School of Agriculture dean Dr Judith Lungu has questioned the credibility of this year’s crop forecast of 1.2 million metric tonnes of maize from the 2007/2008 farming season.

The experts have warned that the current maize situation may lead to another “Carlington maize scandal” since those contracted to import maize have not yet been disclosed.

The government has allowed the Food Reserve Agency (FRA) to import 100,000 metric tonnes of white non-GMO maize from within the region to replenish national reserves since the FRA is currently offloading 20,000 metric tonnes onto the market for the millers.

Imports of the 100,000 metric tonnes of maize will result in an extra expenditure of around US $40 million (about K189 billion, calculated at the current average exchange rate of K4,750 per US dollar) on the part of the government since the landed cost of a tonne of the commodity would be in the region of US $400.

But experts who declined to be named said Zambia cannot be said to be food secure when it was tapping into national strategic reserves at great replacement cost to the Treasury.

“We are planning on expending at least US $400 per metric tonne on importing maize which might not even be non-GMO. The mandate of the importation contract of at least US $40 million is clearly beyond FRA and they have to go to the Zambia National Tender Board (ZNTB). This amount is a lot of money which the Treasury had not planned on spending,” said the experts. “In such scenarios, Dr [Situmbeko] Musokotwane (Minister of Finance) might be forced to cut other budgets.

This is not good for any economy since for the savings from cutting expenditure to be meaningful, they have to target capital projects. This might mean that a school or hospital somewhere might not be completed on time or a road in some district might not be worked on as promised. In other words, the country walks two or more steps backwards for every step taken forward this year. If indeed we have to spend this money perhaps a good portion of it should be spent here.”

They further asked the government to clearly indicate the actual stocks of maize available in the country.

“We are told FRA has around 116,000 tonnes, millers and traders about 200,000 tonnes bringing the total to 316,000 tonnes. This should be enough stocks to last us until the next harvest season,” said the experts. “It is understood that FRA needs to import maize to replenish their stocks but why should they do this at a higher price and sell at a lower price?

An honest miller will confess that his extraction ratio from a tonne of maize is around 50-35-13 to produce breakfast, roller and maize bran. The rest is wastage. Therefore, the subsidy on the raw material – maize – only goes to subsidise consumption by the rich. We do not expect the vulnerable to buy breakfast mealie-meal.”

Agriculture minister Dr Brian Chituwo has disclosed that the FRA was holding 150, 000 metric tonnes which was the minimum requirement for the country’s food reserve.

Food commodities contribute more than half the inflation figure which in turn affects the cost of borrowing. Already, the country’s inflation (15.3 per cent in November) has taken an upward trend, and mostly contributing to this has been the cost of mealie-meal – a by-product of maize.

And agricultural expert Gerrit Struyf has advised millers to become more innovative and use other crops such as cassava to replace maize in production of stock feed.

“Tiger Animal Feeds is now buying cassava chips for use in poultry feeds for K45,000 per 50 kilogramme bag,” said Struyf. “Cassava is a crop which can be produced cheaply by many Zambian farmers; this is another manner to reduce maize imports in the country.”

And Dr Lungu said it was unclear whether the figures released about this year’s maize production were correct considering that the country now requires imports to replenish stocks.

“We were told officially that we had adequate grain for Zambia. What has happened? Last season was not a very good season because of floods in some parts and drought in other parts of the country. I found it strange at that time that we had adequate grain from our harvest. Was this a true assessment?” Dr Lungu asked. “If we produced a lot of maize, where did it go? Where did maize from far-off provinces, provinces far from the line of rail such as Eastern Province, go? We have open boarders and any business person will go where the price is right. Marketing is an issue in these areas and we will continue to spend money on importing if we do not deal effectively with this. What is the quality of maize at FRA? If we had adequate maize stored and it is of good quality, then we should not have had any problems.”

Dr Lungu noted the need for increasing the country’s production levels.

“The country has the capacity to produce enough grain. We need to increase agriculture productivity and production. Harvest of grain especially maize per unit of land has been going down over the years,” said Dr Lungu. “Even if there are subsidies, many of the really poor do not access this fertiliser. Even for the seemingly well-o-do, fertiliser prices are abominably high.

They have to think twice before deciding on whether it is worth growing a crop like maize which requires high inputs considering the high prices of both fertilisers and seed. Some used hybrid seed at some time and continue to recycle it by replanting the grain produced.

It is not hybrid seed any more. It cannot yield much. I think maize production will be low again next year because many have difficulty getting inputs that they can afford for their crop. By December 15, it will be too late to be planting maize.”

Labels: CARLINGTON MAIZE DEAL, FOOD, FRA, JUDITH LUNGU, MAIZE

posted by MrK @ 12:15 AM