By Tawanda Musariri

The Grain Millers Association of Zimbabwe (GMAZ) this morning read the riot act to players in the packaging industry following astronomical packaging material prices that have catalyzed a price surge in most basic commodities.

During a round table breakfast meeting attended by grain millers, players in the packaging industry and Deputy  Minister of Agriculture, Vangelis Haritatos, GMAZ Chairman, Tafadzwa Musarara, critisized the packaging industry for failing to consult the Millers in so far as pricing was concerned.  He further threatened to bring in South African packaging firms to step in should the local players fail to cooperate in matters of mutual benefit in the milling value chain.

The meeting had representatives from two South African packaging firms that control up to a combined 80% of the packaging in South Africa. Mr Musarara said the firms are currently parked but ready to step in at short notice should the need arise.

The packaging industry in Zimbabwe earns $210 million from millers annually.

Musarara told the media after the stakeholder meeting that a 10kg bag of mealie meal which used to cost $0.4 has been hiked to $1, a price surge that the packaging industry says was necessitated by a hike in the price of foreign currency which the industry procures on the parallel market.

"In the past two years we have worked with Government to protect the local packaging industry from foreign imports through SI64. We have been supporting the packaging industry to the tune of $210 million and so we expect them to respond more positively. We are still keen to continue working with them but we want to advise the media that we have invited some players from the packaging industry from South Africa but we have put them on standby," said Musarara

Musarara went on to criticize some packaging firms, which are getting a Reserve Bank foreign currency grant of dishonesty saying their quantity of output is not corresponding with allocated forex.

"Government is subsidising grain production to the tune of $200 million annually to guarantee availability and price stability. If pricing of such basic commodities as mealie meal have to be benchmarked on foreign currency because the packaging industry is demanding forex based payments for their products, the ordinary consumer will suffer because nobody is being paid in foreign currency.

Musarara went on to encourage Government to ring fence the basic commodities packaging industry to make sure that packagers do not refrain from manufacturing such material in favor of such packaging as that of sweets,  biscuits and non-basic confectionary.

Haritatos appreciated GMAZ for the pains the Association had endured to bring in the milling value chain.  He encouraged the industry to design their pricing regimes with the cognisance of protecting consumers and the viability of their industry.