Staff Reporter
The Finance and Economic Development Ministry is planning to pay cotton farmers in United States dollars beginning in the 2021 marketing season, if cabinet adopts the proposal, a contact within Government has revealed.
The government official argues that cotton, just like tobacco, is a foreign currency earner, but only tobacco farmers are prioritised when it comes to foreign currency payment.
Cotton producer price for this marketing season was pegged at ZWL$85 per kilogramme. If the proposal is approved, 60 % will be foreign currency and 40% will be local currency. Using the current exchange rate of 1:$85.07, cotton farmers will receive US$0.60 plus ZWL$34 per kilogramme.
This model of payment will grade cotton from grade A, which is the highest quality to grade D, which is the least quality. This marketing season, most farmers are said to have produced only two grades that is 10 % of farmers produced grade A and 90 % produced grade D.
According to the contact, as cotton is the second foreign currency earner in Zimbabwe after tobacco, it will benefit about 400 000 farmers in region 4 and 5.
The move to pay farmers in US dollars will act as a compensation measure as the previous year, Cottco owed farmers ZWL$1.5 billion from last season.
The contact revealed that a new hybrid cotton seed will be adopted for the 2021/2022 agriculture season. The hybrid seed produces a yield of 1500kg per hectare compared to the one which was being used which produces 400kg per hectare.
Cotton Producers and Marketers Association Chairman, Mr Stewart Mubonderi welcomed the move to pay cotton farmers in foreign currency saying the development will lure more farmers to join cotton farming.
“Poor prices had killed farmers’ appetite to grow the white gold. Year after year, cotton farmers were left counting losses due to poor prices. The foreign currency payments will go a long way in cushioning farmers and boost their moral and appetite to produce more.
“The issue of introducing hybrid seed is also highly welcome as it will improve yields and maximise profit. It is my hope that with these developments, the 2021/2022 agricultural season will be a better one,” said Mr Mubonderi.
Mr Mubonderi said good prices would discourage farmers from side marketing.
Cotton, once one of the country’s largest foreign currency earners, had lost glitter as farmers shunned the crop due to lack of funding, poor prices and payment modalities offered by producers. However, following initiatives such as the Presidential Cotton Input Scheme, production has been on the increase.
