by Christopher Makaza
Cotton Company of Zimbabwe (Cottco) is set to buy Seedco Zimbabwe’s 40 percent stake in seed developer, Quton company, a development which will resuscitate Cottco`s dominance in the local cotton industry.
The remaining 60 percent share is owned by Mayhco of India.
A contact within the company revealed that Seedco was willing to sell its 40 percent stake in Quton so that it concentrates on food crop seed. It was further revealed that Seedco had not yet put forward the purchase value. Cottco has since communicated with Seedco of its intention to buy the stake in Quton, the source said.
Cottco and Quton`s relationship has been that the former produces cotton seed for Quton. Quton then processes the seed and sells it back to Cottco for distribution to cotton farmers. This means there is a strategic synergy which requires Cottco to maintain a close relationship with Quton.
An economic analyst, Raymond Gwatidzo highlighted that Cottco`s idea to buy a stake in Quton is strategic in that it will be able to control the quality of seed.
“This will also encourage Cottco to invest in new seed varieties as a shareholder together with Mayhco which has supplied a promising new high yield hybrid variety,” he said.
Meanwhile, a field visit was recently undertaken in Muzarabani by Cottco to assess the potential of the Mayhco hybrid variety. It was noted that the variety yields five times more than the traditional open pollinated varieties (OPV) produced by Cottco. It was also discovered that the mature ball count of the hybrid variety averaged 70 to 80 balls per plant compared to the 10 to 15 balls for OPV.
According to the Cottco contact, the Mayhco variety seed has a potential to produce 120 balls and is more resistant to drought than OPV and that it has longer fibre length preferred by weavers and ginners than OPV.
During the Muzarabani visit, it was also discovered that some OPV balls and flowers failed to mature due to inadequate rains.
Cottco`s move to acquire a stake in Quton is a noble idea considering that it is the sole administrator of the Presidential Cotton Input Scheme that has revived the cotton industry and transformed lives of the majority of the rural cotton farmers.
Cottco`s partnership with Mayhco will also give it a chance to explore on more productive seed varieties that will go a long way in boosting cotton production in the country.
Cottco, which had collapsed, was resuscitated through Zimbabwe Asset Management Company (ZAMCO) loan and acquisition of the National Social Security Authority (NSSA) and Old Mutual shares.
