COTTON farmers have threatened to withhold their produce this selling season as some have not received their payment for the 2020 crop, Cotton Company of Zimbabwe (Cottco) managing director Pious Manamike has said.
Speaking to the Daily News yesterday, Manamike said the delayed payments would affect the white gold sales for the 2021/22 season.
“In 2020 we have a balance of about $320 million, for the 2021 season we still owe the farmers $53 million and almost $310 million for grade adjustments for those people who had delivered Grade A and B.
“The announced price for cotton is for the lowest grade D, but as we are grading some farmers have Grades A and B, which fetch better prices so we have to top up and give them the correct price.
“Late payments will affect us as farmers are still not happy that they are still owed money. This may slow down the start of the selling season as they are threatening to withhold the crop.
“Some farmers are actually saying ‘pay us first if you owe us then we can deliver the new crop’ and that is where the threat is,” Manamike added.
He said Cottco had put in place measures to ensure farmers receive their money early, but climate change reduced the output of the crop and delayed the selling season, which normally begins this month.
“I cannot comment on behalf of the Treasury, but the price that we are paying as Cottco, we have mobilised resources to pay the full amount on the spot. I am told that maybe this year there won’t be a subsidy, so we are paying everything as Cottco.
“We had a late cropping season because of the late start of the rain and the crop is still in ball formation in the fields. Our estimates are still a bit rough, with the negative conditions we have experienced, maybe we are at 80 000mt to 100 000mt, which is the range we are expecting. Last year, Cottco bought 116 000tonnes and we fetched roughly US$78 million in export earnings.”
Early this year, the Agriculture Marketing Authority announced new 2021/22 agricultural season cotton prices.
Cotton produced under the Pfumvudza scheme is priced at $63.23 per kg and cotton financed under non-government funded arrangements is $111.17 per kg.