Flood market with local wheat, Cottan urges farmers
By Chiwoyu Sinyangwe
Tue 11 Jan. 2011, 04:01 CAT
PETER Cottan says Zambian farmers should flood the local market to depress wheat prices which have jumped 60 per cent since the last quarter of 2010. And Cottan says he is shocked by ZNFU’s call for his arrest over his statement on escalating wheat prices in the country. Wheat prices have surged
to US $530 per tonne from US $320 at the end of the harvest period last October.Cottan, the managing director of National Milling Corporation, said owing to the recent projection of about 200, 000 metric tonnes of the recently harvested wheat, the commodity should fetch US $450 per tonne instead of the current spot price of US $530. He said although wheat prices have gone up by 60 per cent, the price of flour was not expected to rise by the corresponding margin because the final consumers could not contain such a price hike.
Cottan said the current surge in wheat prices on the local market could be attributed to farmers hoarding the commodity to force an increase in price.
He said recent indications from Zambia National Farmers Union (ZNFU) that there was no way the country could be talking of a shortage when wheat harvest was done only 60 days ago should be justified by local farmers flooding the commodity on the market.
“My call to the commercial farmers through the Zambia National Farmers Union is that they should flood the market with the wheat so that our members will purchase the wheat so that we stabilise the food and flour prices,” said Cottan who is also the chairman of the Millers Association of Zambia (MAZ).
He claimed that millers and the bakers were absorbing the current high wheat prices which he said were too high to be absorbed by the final consumer of flour products.
Cottan said wheat prices should be reduced if there was a bumper harvest as was the case with maize in last harvest season.
“When you have a surplus, prices should track export parity just as maize has done, and when you have a deficit, the price tracks import parity,” he said. “But when you have prices not coming down when you have a surplus, then it means there is something wrong.”
And Cottan chided ZNFU’s calls for his arrest over his statement on escalating prices of wheat in the country.
Cottan, who also announced that NMC had hiked prices of flour by about K5 000 following the surge in wheat prices, said he was shocked that ZNFU called for his arrest following his statement.
“I believe that I have been a good corporate citizen in the country, I have been serving for the last 23 years and I took this position as MAZ chairman because I wanted to give back to the nation,” he said.
Cottan further said there was need for all industry players to work towards this Friday’s stakeholders meeting to determine the current wheat position in the country.
Labels: KARTELS, PETER COTTAN, WHEAT, ZNFU
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ZNFU calls for Cottan’s arrest
By Chiwoyu Sinyangwe
Mon 10 Jan. 2011, 04:01 CAT
ZAMBIA National Farmers Union says Peter Cottan should be arrested over his “irresponsible and unfortunate” statement that bread prices are expected to surge this week due to ‘artificial shortage’ of wheat in the country.
Cottan, who is Millers Association of Zambia (MAZ) chairman, complained that National Milling Corporation (NMC) and other millers were finding it expensive to access the wheat owing to the surge in market prices.
He said MAZ would pass on the cost of the high cost of wheat to final consumers of bread. Cottan, who accused ZNFU of hoarding the wheat prices despite the bumper harvest, called on the government to ban wheat exports being driven by high international wheat prices.
Currently, wheat prices have surged to US$530 per tonne from US$320 at its lowest ebb.
But ZNFU president Jervis Zimba said Cottan’s claims were callously dangerous, irresponsible and aimed at undermining the government’s efforts and those of farmers in ensuring food security in the country.
Zimba said the country had sufficient wheat stocks after the harvest two months ago, and there was no shortage to warrant NMC’s proposal for a 60 per cent hike in flour prices.
He said Cottan’s statement was “very dangerous to the peace of the country” as it was capable of creating anxiety and fear among the public.
“The union is therefore calling for the Inspector General of Police to arrest Mr Cottan for inciting the Zambian consumers and the general public to rise against the farmers and the government on grounds that there is going to be acute shortage of food and imminent unprecedented food price increases,” Zimba said.
“We also demand that Mr Cottan tenders a public apology to the Zambian Government, ZNFU and the farmers of Zambia and withdraw the statement henceforth.”
He also challenged Cottan to make public the minutes of the meeting where all millers met and resolved to increase the price of flour by 60 per cent starting today.
“The Union is desirous to know and establish as to whether this is a general position of all millers or it is Mr Cottan’s personal agenda,” said Zimba.
“The Union would like to warn that it will not sit idle and watch the farmers of Zambia being maligned as a greedy group of people in the public eye. It does not matter whether that person or institution is so powerful or well known…”
Labels: INFLATION, JERVIS ZIMBA, MAZ, PETER COTTAN, WHEAT
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Millers buying maize to address farmers’ grain wastage - Cottan
By By Florence Bupe and Mutale Kapekele
Sun 14 Nov. 2010, 04:00 CAT
MILLERS are still purchasing maize from peasant farmers as a way of helping address the challenge of grain wastage. And farmers in Monze and Kalomo have confirmed that some of the maize that was supplied to the Food Reserve Agency has gone to waste after it was soaked by heavy rains.
In an interview, Millers Association of Zambia chairperson Peter Cottan said some members of the association were buying maize from farmers at prices ranging from K980 to K1,000 per kilogramme.
Cottan said the association realized that there were still farmers who had not managed to sell their produce to FRA during the just ended crop marketing season, and deemed it fit to step in and help manage the country’s harvest.
Zambia has this year recorded an unprecedented maize harvest of 2.8 million metric tonnes of maize but various concerns have been raised over the management of the harvest, with grain going to waste in some parts of the country as a result of poor storage.
“Millers still have an appetite for maize and some members are still purchasing maize from farmers at even better prices. Farmers should find ways of getting their maize to the market as millers are still willing to buy,” said Cottan.
And Vincent Mainza, a Monze farmer, confirmed in a telephone interview that some of the maize that was supplied to the FRA had gone to waste.
The FRA purchased close to a million metric tonnes of maize from farmers across the country, which almost tripled the 300,000 metric tonnes that were planned for.
This presented storage and transportation challenges to the agency and most of the maize ended up in the open with just ordinary tents to cover them.
Mainza said affected depots in Monze, where maize was damaged by rain included Hampande, Millele, katimba and Nteme.
He also observed that only maize that was packed in grain bags provided by the farmers was affected.
The agency had run out of grain bags at the beginning of the marketing season and accepted bags that were provided by the farmers.
And Kalomo grain trader Wisdom Moono confirmed that maize grain bags provided by the farmers rotted just after that first rains leading to some of the grain germinating.
Moono also said some of the maize was cooked by the sun due to long periods of exposure.
Unconfirmed reports are suggesting that a substantial amount of the 2.7 million metric tonnes of this year’s bumper harvest has gone to waste.
Labels: FRA, MAIZE, PETER COTTAN, VINCENT MAINZA, WISDOM MOONO
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EAZ urges govt to re-visit windfall taxes
By Fridah Zinyama
Sat 09 Oct. 2010, 13:50 CAT
ECONOMICS Association of Zambia (EAZ) president Noel Nkoma has urged government to re-visit the issue of windfall taxes, saying government is losing out on revenue collection from the mining sector through the lack of re-introduction of this tax regime.
Copper has now reached a high of $8,285 per metric tonne, the highest level since the beginning of this year.
The high copper prices have again spiked the debate on whether government should re-introduce the windfall so that the country could benefit from the high prices of the red metal on the international market.
Commenting on the 2011 national budget presented to Parliament by finance minister Dr Situmbeko Musokotwane on Friday under the theme ‘A people’s budget, from a people’s government”, Nkoma said government had made no mention on whether they would re-introduce the windfall, an omission which was very costly to the country.
“Government should have just mentioned even the intention to resolve the windfall tax issue but they have remained silent over this very important issue,” he said. “It’s not too late to make amends on the windfall tax now that prices are high again.”
On the K43 billion which has been allocated to the Ministry of Agriculture for irrigation, Nkoma said the amount was not enough to adequately deal with the issues which might arise due to the effects of climate change.
“With the way the weather pattern has been changing, it is important for government to take issues of improving the irrigation system in the country so that we can reduce dependence on rain for crop production,” he said. “We should not take the bumper harvest that we have produced this year for granted, the weather can change and therefore affect maize production for the coming years.”
Nkoma said it was therefore important that government increased the allocation to irrigation so that the country reduced its dependence on rain for crop production.
On the reduction on budget support from the donor community from 14.5 per cent to 7.7 per cent, Nkoma said it was a welcome move which showed that the country’s economy is growing hence its ability to look after itself was improving as well.
On the budgetary allocation of K12.8 billion to the Ministry of Tourism for marketing Zambia’s tourism sites, Nkoma said the amount should have been increased to deal with issues of re-stocking of game in the national parks.
“Government has allocated enough funds for the building of roads and bridges in next year’s budget, will lead to an increase in tourists coming to visits Zambia,” he observed. “But the problem is that there is not enough game in the national parks across the country hence the need for money to re-stock.”
Nkoma said government was shooting itself in the foot by not allocating enough funds to deal with game re-stocking in next year’s budget.
And Millers Association of Zambia (MAZ) chairman Peter Cottan has expressed happiness with government’s decision to increase the PAYE exempt threshold by 25 per cent from K800, 000 to K1 million per month.
Cottan said the increased PAYE exempt threshold would put more disposable income in people’s pockets.
[Not necessarily. The reduction of PAYE is pretty much offset by the borrowing of $500 million, which is a burden on the Kwacha and results in worse exchange rate, which means higher prices for imported goods in the shops. The government sees a reduction in donor funds, and their answer is: let's borrow half a billion US dollars. - MrK]
“By taking so many workers out of the tax bracket, more people will have disposable income in their pockets to spend on the other things,” said Cottan.
In next year’s budget, the proposed PAYE system is: from K1,000, 000 and below- zero per cent; K1,000,000 to K1,735,000 per month- 25 per cent, K1,735,000 to K4,200,000 per month - 30 per cent and above K4,200,000 – 35 per cent.
Dr Musokotwane said government would further provide relief by increasing the exempt portion of income paid at termination of employment from K25 million to K35 million and increasing the tax credit for differently-abled persons from K1.92 million to K3 million.
And Cottan commended government for allowing agriculture to remain a priority in next year’s budget.
Labels: EAZ, NOEL NKOMA, PETER COTTAN, WINDFALL TAX
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Embrace aqua culture, Cottan urges farmers
Written by Mwila Chansa in Kitwe
Monday, October 05, 2009 8:43:28 PM
NATIONAL Milling Corporation (NMC) managing director Peter Cottan has encouraged Zambian entrepreneurs to venture into aqua culture as it provides an opportunity for income generation.
During the unveiling of the new NMC branch in Kitwe that will cater for markets in Copperbelt, North Western, Luapula and Northern provinces, Cottan disclosed that the milling company had introduced fish feeds as one of its products to encourage fish farming.
"We want to promote aqua culture because it provides a huge opportunity for empowerment. Fish is not just an excellent source of protein but it is also an opportunity for small-scale fish farmers to generate income," said Cottan.
Cottan said the Zambian aqua industry had enormous potential to meet market demands but that currently, this was not the case.
He said he had spoken to the Shoprite managing director who was also in support of NMC's idea to introduce fish feeds.
Cottan observed that firms such as Shoprite imported over 80 per cent of their tilapia (fish) not because they wanted to but because the local industry could not provide it.
And speaking earlier, Cottan said NMC wanted to contribute to development in rural provinces such as Luapula and North Western provinces.
And Luapula Province permanent secretary Jazzman Chikwakwa welcomed the opening of the new branch to supply to four provinces, saying that it would help small-scale farmers find a ready market for their maize.
"This will stop unscrupulous traders from swindling hard working farmers," said Chikwakwa.
He added that the opening of the new office would also reduce smuggling of maize meal to neighbouring countries.
Meanwhile, Copperbelt permanent secretary Villie Lombanya, in a speech read for him by provincial assistant secretary Stephen Lindunda, said NMC's investment in the province would make the staple food readily available to people.
He said shortages of mealie-meal usually became political and that the new investment was a well-calculated step to curb such occurrences.
Lombanya added that NMC's investment was testimony of good governance in the country as there could not be investments in the absence of good governance.
Labels: AGRICULTURE, PETER COTTAN
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Cottan rules out immediate reduction in mealie-meal prices
Written by Chiwoyu Sinyangwe in Lusaka and Justine Kawisha in Mazabuka
Saturday, February 28, 2009 9:21:15 AM
MILLERS Association of Zambia (MAZ) vice chairperson Peter Cottanhas said adjustments to the current mealie-meal prices are only expected to be made next month.
Cottan explained that millers were currently selling mealie-meal at a fixed price as they were getting maize from Food Reserve Agency (FRA) at a fixed price.
Cottan, who is also National Milling Company (NMC) managing director, said the millers in the country were at the moment receiving a steady supply of maize from FRA.
He said millers were currently working at increasing the mealie supply in the country as a way of stabilising the supply of the country's staple food.
“As far as current prices are concerned, all the millers are under contract with FRA and the price is fixed and so is the price of maize…but from March,” said Cottan.
“There are discussions going on between FRA, the ministry of agriculture and millers of whether these prices will remain the same. We don't know yet but we are getting stable supply of maize now.”
FRA is currently selling a 50-kilogramme bag of maize to millers at K55, 000.
Currently, a 25-kilogramme bag of breakfast mealie-meal in the country is selling at an average price of K47, 000 while the same quantity for roller meal is presently pegged at about K38, 000.
Meanwhile, the shortage of mealie-meal in Mazabuka has become a business opportunity as some traders are conspiring with transporters to illegally divert the consignments and offload before they reach their destinations.
Police in Mazabuka on Wednesday impounded a Lusaka-based truck loaded with mealie-meal from the National Milling Company meant for Mazabuka depot. This was after the truck driver diverted the commodity and started offloading into a canter truck for private business in the nearby bush.
The incident happened around 14:00 hours in Kaonga area after some members of the community who found the transporter offloading the commodity became suspicious and tipped the police.
A check at the scene found the Volvo truck registration number ABH 4820 of Madimba Constructions of Chelston in Lusaka which was offloading the mealie-meal being ordered by the police to stop.
The police then ordered the four-tonne canter truck registration number AJB 6839 which was carrying the offloaded commodity and the Volvo truck to the police.
Meanwhile, police nearly manhandled the driver of the canter truck for what they termed “monkey tricks” when he refused to move his truck, saying it had run out of fuel as they were heading for the police.
The driver twice pretended that his vehicle was faulty and later said it had run out of fuel, a situation that annoyed the police and prompted them to buy fuel from Vuma filling station to enable the truck reach the police station.
But the driver of the Volvo truck vindicated himself in the matter saying he was working under instructions from a depot official in Mazabuka who told him to offload the commodity in a private area.
He said he was transporting 400 bags of mealie-meal to the Mazabuka depot but that he was instructed that half of the consignment was already bought by some business persons from Monze.
But the canter driver denied to have been hired to take the commodity to Monze and only said he was told to load and take the commodity at the Mazabuka depot.
Efforts to talk to the National Milling depot manager in Mazabuka proved futile as he was being questioned by police by press time.
And Mazabuka district commissioner Tyson Hamaamba directed the police to detain both drivers and confiscated the mealie-meal.
Hamamba further summoned national milling management to explain how the distribution of the commodity was done.
He said it was inhuman to sell the scarce commodity to other places for profit making when people in the district were spending nights looking for it.
Hamamba confirmed that management at National Milling responded to his request and promised to report to his office by yesterday.
Labels: INFLATION, MEALIE-MEAL, PETER COTTAN
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NMC urges ZRA to curb tax offences
By NANCY MWAPE
NATIONAL Milling Corporation (NMC) has called on the Zambia Revenue Authority (ZRA) to ensure that companies were tax compliance in order to grow the economy.
NMC managing director, Peter Cottan said tracing of companies defaulting on Value Added Tax (VAT) was easy to stop if
ZRA could conduct an audit trail through the value chain of the products.
“Example, if a miller wants to break VAT chain, they can agree to buy wheat from the farmer at cash and no invoicing done. This way Government is losing out on revenue that should be targeted at social services,” he said.
In an interview in Lusaka Mr Cottan said it was saddening that most ZRA officials were being corrupted by the companies that are supposed to pay tax. Mr Cottan said a number of companies were defaulting tax especially VAT.
“There is need to level the playing field so that companies competed favourable on the market. ZRA should be pro-active, go after non-compliant companies to broaden the tax base,” he said.
Labels: NMC, PETER COTTAN, VAT
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Compel traders to quote in kwacha, urges Cottan
Written by Mwiinga Mukuwa
Thursday, January 15, 2009 3:05:56 AM
NATIONAL Milling Cooperation managing director Peter Cottan has asked the government to come up with a deliberate policy that will compel traders to quote prices in the local currency.
In an interview, Cottan said millers spent millions of dollars when purchasing wheat and soya beans from commercial farmers who insisted on being paid in US dollars.
“That is a huge strain on the treasury and exchange rate. We have to buy millions of dollars to pay for wheat. I don’t think there is justification for that, I think we can go all the way down the chain,”he said.
Cottan said the government must ensure that the suppliers of fertiliser and chemicals which were imported into the country and trading through local companies should be quoting prices in kwacha.
“This will ensure that the whole chain is kwacha denominated. Some years when the kwacha hit K5,000 against the dollar, a meeting was held between Bank of Zambia and the private sector…we had a voluntary code of conduct where we wanted to put measures of the exchange rate controls. We agreed that we were all going to invest in kwacha,” he said.
Cottan said there was need to get back to those fundamentals owing to the global financial crisis and the kwacha’s devaluation against the US dollar.
“We cannot afford to have any dollarisation of our economy as it is a strain on the treasury,” Cottan said.
He said only the tourism industry could justify the quoting of prices in US dollar as it directly dealt with foreign tourists who mainly use foreign currency while in the country.
“It’s important we go back to these fundamentals and ensure that every body invests in the kwacha and not trading in dollars, “said Cottan.
Late last year, Bank of Zambia (BoZ) governor Dr Caleb Fundanga indicated that the Central Bank would not tolerate the issue of foreign currency quoting and invoicing of goods and services within Zambia. He noted that Zambia’s pursuance of an open economy should not, in any way, be construed to mean that dollarisation became an accepted norm governing local business transactions. Dr Fundanga said the Central Bank was fully aware that the recent depreciation of the kwacha may have been precipitated by the rebirth of the practice where traders quoted prices in US dollar.
Labels: KWACHA, PETER COTTAN
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Imported maize to roll in
December 31, 2008
The Food Reserve Agency (FRA) says the imported 110 metric tonnes of maize will start arriving in Zambia next month. Executive Director Anthony Mwanaumo says the agency is this week expected to complete the signing of three contracts to facilitate the importation.
Dr. Mwanaumo said one contract has already been signed while the other remaining two will be signed by the end of this week. He was speaking in an interview with ZNBC news in Lusaka, Wednesday.
And Dr. Mwanaumo has appealed to millers that have accessed from the agency to pass on the benefits to consumers by reducing mealie-meal prices.
He said millers who have not yet reduced mealie-meal prices should emulate their contemporaries who have reduced the prices of the commodity to acceptable levels.
And National Milling Corporation says it will soon reduce mealie meal prices in line with the reduction in maize prices by the Food Reserve Agency (FRA).
Managing Director Peter Cottan said his company submitted a letter recommending a reduction in mealie meal prices to the minister of Agriculture, Wednesday.
Mr. Cottan explained that national milling delayed in reducing the price of mealie meal because the old contract it had with the Food Reserve Agency has expired.
He also told ZNBC that his company will start buying subsidized maize from FRA starting Wednesday.
Mr. Cottan said national milling will announce a reduction in mealie meal prices after getting a feed back from government.
The Food Reserve Agency last week announced a reduction in maize prices from 63 thousand Kwacha to 55 thousand Kwacha for a fifty kilogramme bag.
Chimanga Changa Milling Company became the first Company last week to reduce price of its Mealie Meal following the reduction in the cost of Maize from FRA.
[ZNBC]
Labels: MAIZE, MILLERS, PETER COTTAN, PRICING
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