The Sunday Mail
The World Farmers’ Organisation (WFO) — an affiliate of the United Nations which is considered to be one of the world’s largest farmer organisations — has said although the local tobacco sector is performing very well, there is need to evaluate its main financing model to ensure that farmers get the maximum possible benefit from the cop.
In an interview with The Sunday Mail on the sidelines of the 75th Commercial Farmers Union of Zimbabwe (CFU) Congress, WFO president Mr Theo De Jager said just like cotton, tobacco has closed value chains.
He said the current tobacco contract system, which gives the sponsoring companies the latitude to set the price of inputs supplied to the farmer and determine the price at which it buys the produce, could be prejudicial to farmers.
“Zimbabwe is performing outstandingly in the production of tobacco. That is good. However, tobacco and cotton are closed value chains. You cannot sell tobacco or cotton from a street corner, you can only sell it through the process,” said Mr Jager.
“You get big multinational companies supporting these smallholder farmers to plant tobacco, which the financier buys himself. So he knows exactly what he borrowed to that farmer and he makes the price to buy it back. That sort of enslaves the farmers. Ideally, financing and buying should be separate.
“So going forward, Zimbabwe should look at options of opening up the value chain, which is why it is also important to boost livestock production and horticulture. The value chains for those are open,” he said.
Zimbabwe recorded a record tobacco crop during the 2018 marketing season as farmers delivered 250 million kilogrammes worth $729 million of the golden leaf.
The bulk of the crop was, however, delivered under contract farming.
Statistics from industry regulator, Tobacco Industry Marketing Board (TIMB), show that 214 million kgs worth $631 million were sold through the contract system, while 36 million kgs worth $98 million were sold through the auction floors.
Land tenure
The international farmers’ representative organisation, which claims to represent 1,5 billion farmers from 54 countries across the world, said potential investors in Zimbabwe’s agricultural sector are mainly concerned with security of tenure.
He said if the two issues are solved, this could help attract international funding for farmers.
“Land should be bankable so that the farmers can invest.
“I have brought some investors here to Zimbabwe, but they were all complaining that their money is stuck here. They did good business, but how do you bring more tractors or pivots in when you can’t take the money out to buy more,” he said.
Government has since made a commitment to consolidate land ownership and security of tenure.
In its 2018 elections manifesto, Zanu-PF indicated that it will “expedite the issuance of security of tenure documents to the beneficiaries of the land reform programme”.
Agriculture provides livelihoods to over 70 percent of the local population and supplies industry with 60 percent of its raw materials.
Government considers it a key pillar in building an upper middle-income economy in the next 12 years.
Plans are underway to modernise the sector in order increase both production and output per unit area.
Vote of confidence in
Minister Shiri
Mr Jager believes that the Minister of Lands, Agriculture, Water, Climate and Rural Resettlement, Chief Air Marshal Perrance Shiri (Retired) is best suited to steer reforms in the sector and increase production.
“In the meetings I have had with Minister Shiri, I liked his open-mindedness. I liked his military-like style. He knows what needs to get done and he knows where things got stuck. He understands discipline and he understands proper management. A lot of challenges in the agriculture sector, which Zimbabwe has accumulated over the last decade and a half, were in the department of agriculture,” said Mr Jager.
“I have good hope that this will be sorted out now. He understands that the biggest challenge in rural Zimbabwe is poverty. He understands that the necessity is jobs.
‘‘He knows the only way to kill poverty is through wealth creation.
‘‘He told me face to face that no other sector in the economy of Zimbabwe is better positioned to create wealth in rural Zimbabwe in a short space of time on a broader and cheaper basis than agriculture.”
According to Mr Jager, Zimbabwe should embrace modern technology such as digital farming to boost production.
