Martin Kadzere, Harare Bureau
THE country’s largest financier of cotton farmers, the Cotton Company of Zimbabwe (Cottco), has increased the producer price of the commodity by 54 percent to cushion growers from rising inflation.
Government initially pegged the producer price of raw cotton at $1,95 per kilogramme, but prevailing high inflationary pressures have made the upward review necessary.
Zimbabwe’s inflation rose to triple digit levels last month, with annual rate hitting 175,7 percent in June from 97,9 percent in May, according to ZimStats’ latest figures.
“Effective today (yesterday) our farmers will be getting $3 per kilogramme,” Cottco managing director Mr Pious Manamike said.
“The adjustment is necessary to cushion our farmers from high inflationary pressures and also taking into consideration that the US dollar equivalent (of $1,95) was quite high when we started buying.”
At the beginning of the marketing season, the value of the Zimbabwe dollar was trading at around 3 to 1 against the United States dollar and yesterday, the rate was at 8,82 to the greenback.
Cotton Producers and Marketers Association chairman Mr Steward Mubonderi commended the move by Cottco while urging farmers to deliver their crop to the company early.
“This move will also benefit farmers who have a late crop especial those in Chiredzi.
“But farmers should deliver their crop so that they benefit from the price,” Mr Mubonderi said.
Cottco will continue partly paying the farmers in US dollars. The company administers the Presidential Free Inputs Scheme, a state funded programme meant to increase production. Nearly 400 000 farmers get assistance under the programme.
Launched in 2015, the programme has helped the resuscitation of the industry with output growing from 28 000 tonnes, the lowest in nearly two decades, to 143 000 tonnes last year.
About 90 percent of the production was funded by Cottco.
Addressing a stakeholders meeting organised by Cottco three weeks ago in Mushumbi Pools, Deputy Minister for Lands, Agriculture, Water, Climate and Rural Resettlement Douglas Karoro said the Government had decided to extend the inputs programme.
“I know you were affected by the drought last year and you did not manage to achieve good yields,” said Mr Karoro.
“I would like to tell you that this year, the Government has decided to extend the programme and you will be getting free inputs.”
Cotton remains an important source of livelihoods for most rural communities.
It is a drought tolerant crop that can be grown in arid and semi-arid areas of Zimbabwe.