Martin Kadzere Senior Business Reporter
ZIMBABWE’S cotton output in the 2013 /14 season declined to its lowest level in four years as farmers continue shifting from the crop to better rewarding crops such as tobacco.
Cotton output for the 2013/ 14 season declined 6,2 percent to about 136 million kilogrammes, from 145 million kilogrammes a season earlier, Cotton Ginners Association said yesterday. During 2011/ 2012, Zimbabwe’s cotton production was 350 million kilogrammes.
The association, a grouping of cotton merchants, had projected output would reach 190 million kilogrammes.
“It is largely to do with migration to tobacco, but we also had a late crop, which failed to properly mature and this is why we have such huge variance,” CGA director general Mr Godfrey Buka said.
Cotton prices ranged from 50c and 70c per kilogramme during last selling season, an improvement from between 45c and 60c per kilogramme from a season earlier, according to CGA.
Analysts, however, said the sector could still be viable if properly regulated. They have blamed side marketing as one of the major factors “killing the once viable sector.”
“Going back to a State body buying all the cotton is the way to go. This will achieve superior efficiencies and this was by far a better model than the current, which has impoverished the majority of cotton farmers,” commented one analyst.
Last year, the Government said it was planning to re-establish the Cotton Marketing Board, abolished about 20 years ago, to actively participate in the marketing of the crop and has not yet indicated the progress achieved so far on the plans.
Cargill, one of the largest cotton merchants announced that it had closed its local cotton business citing operational challenges. The company, which had more than 20 000 farmers under its cotton contract scheme countrywide, said it had significantly suffered from low cotton output in the past two seasons, depressed margins as well as high levels of breach of contractual obligations by cotton growers.
“Even when lint prices were declining, some merchants ended up offering higher prices to safeguard their crop and it is not surprising that big merchants have closed because the environment has financially incapacitated them to continue supporting their schemes,” one industry player.
“Without proper regulations, we may have a smaller crop next season because a number of merchants may significantly scale down their support.”
At its peak, farmers produced 353 million kg in 2 000, making the crop one of the major foreign currency earners.