Maravi

(LUSAKATIMES) Mealie meal prices to fall

Mealie meal prices to fall
January 4, 2009

The Food Reserve Agency (FRA) has projected a further reduction in mealie-meal prices but has urged Government to increase its budgetary allocation for it to effectively carry out its mandate of ensuring food security in the country.

FRA executive director, Anthony Mwanaumo, said in Lusaka yesterday that some milling companies were still using their old stock of maize bought at a higher price and they would be expected to reduce the prices of their mealie-meal when they start using stocks bought at a lower price from the FRA.

Dr Mwanaumo was speaking in Lusaka during the recording of “Culture Remodeling” television programme hosted by the Ministry of Finance and National Planning.

He said the FRA has worked out procedures for the release of stock and has effected protective mechanisms to ensure stabilisation and subsequent reduction of mealie-meal prices.

The FRA has reduced the price of a 50kg bag of maize from the previous K63,000 to K55,000.

The agency has also increased maize supply to millers from 30,000 metric tonnes to 60,000 metric tonnes per month.

When the country is not experiencing a maize deficit, the agency supplies the millers with only 30,000 metric tonnes each month. The quantity is half of the total amount of maize consumed nationwide each month.

The agency plans to purchase an additional 163,000 metric tonnes of locally supplied white maize to meet the millers’ requirements and to replenish the strategic reserves.

Dr Mwanaumo said that the agency has 80,000 metric tonnes of maize in its strategic reserves and that it needs more funding for it to operate better.

He said Government’s allocation of K80 billion for the 2008-09 marketing season was a 67 per cent reduction from the previous season’s allocation. In the 2007-08 marketing season Government allocated K240 billion.

He declined to say how much the agency would need to operate to expectations, but said that the FRA was in dire need of more funding.

“We have 80,000 metric tonnes in strategic reserves…Our stocks are relatively low. You have seen us of late importing and buying stocks from the local growers,” Dr Mwanaumo said.

He said the FRA has learnt something critical from borrowing in order to meet its objectives. This was in reference to the K270 billion that the FRA borrowed for the 2006- 2007 marketing seasons.

“When you borrow, you cannot achieve your desired goals considering that you have to pay back interest. We borrowed K270 billion and at least we managed to pay back the debt,” he said.

Dr Mwanaumo said that the FRA has a storage capacity of 2 million metric tonnes of maize and that it realised K7 billion in the last three years through the provision of market access to farmers.

He said most peasant farmers have improved their livelihoods because the FRA has been able to buy produce.

Dr Mwanaumo said the FRA has proposed a higher budgetary allocation for the next farming season to enable it meet its obligations of ensuring food security.

He said in view of the global credit crunch there was need for increased production and improved market access for the farmers.

He said that Zambia’s maize production capacity was far from being attained.

Dr Mwanaumo said Government must encourage irrigation farming, production of diversified crops and enhance the fertiliser support programme.

He has also noted that Zambia’s crop production belt had shifted from Southern Province to Northern Province.

Dr Mwanaumo said this was why the FRA closed some satellite depots in the Southern Province and opened more in Northern Province.

Daily Mail

Labels: ANTHONY MWANAUMO, FRA, INFLATION, MEALIE-MEAL

posted by MrK @ 4:11 PM