The Sunday Mail
Harmony Agere and Abigail Mhondoro
Zimbabwe was recently ranked among the ten largest cotton producers in Africa despite the dwindling land area put under the crop as well as the constant slump in national cotton output over the years.
A report released by Index Mundi, a global commodity brokerage portal, ranks Zimbabwe as the ninth largest cotton producer in Africa while it is also ranked 27th out of 192 cotton producing countries in the world.
This was after the country produced 112 554 metric tonnes of lint (processed cotton) last season.
However, local farmers and experts are not convinced that the flattering ranking is anything to cheer for as it does not reflect the true situation on the ground as cotton farming in the country is slowly going to the dogs.
As a result of the shrinking market and falling world producer prices, farmers are predicting more hard times to follow for a crop once termed the “white gold.”
Their predictions are in tandem with the Index Mundi forecasts that world cotton output will decline by 6 percent in 2016 due to falling global prices.
The international Cotton Advisory Committee has also projected that world cotton output would drop to about 25 million metric tonnes in 2016.
The Zimbabwe Commercial Farmer’s Union (ZCFU) president Mr Wonder Chabikwa, said the slump on the international market is likely to impact severely on profits locally thereby resulting in the reduction in the hectarage under the crop.
“The decline in global prices and shrinking world markets is likely to impact negatively on local farmers,” he said.
“If the cotton sector intends to make profit this year, there is need to revamp the textile industry so that we can make our own materials rather than exporting our raw materials and import the processed product at high costs,” he said.
Mr Chabikwa said revamping the textile industry will create local markets and boost profits since a constant demand is likely to spur prices.
Mr Chabikwa’s assertions are reflective of the Zim-Asset blue print which advocates for value addition as opposed to the export of raw materials.
The Zimbabwe Farmer’s Union (ZFU) vice president, Mr Berean Mukwende echoed Mr Chabikwa’s sentiments that world prices will affect local farmers, adding that cotton has already been eclipsed by other cash crops such as tobacco.
“Cotton has long been beaten by other cash crops such as tobacco, maize and soya beans because its prices are low internationally.”
The world prices slump is believed to be a result of policy shifts in China which is the world’s largest market for cotton.
According to research, the falling prices are a result of the rise in United States’ increasing supply and reduced imports by China, which is the world’s largest consumer of cotton.
The decline is also spurred by most farmers’ decision to ditch cotton for other crops such as maize, soya beans and tobacco.
In Zimbabwe, cotton producers and ginners are already locked in a pricing war with farmers complaining about the low prices offered by ginners.
During last year’s cotton marketing season, there was a standoff between cotton producers and ginners over cotton producer price as ginners refused to negotiate after the Competition and Tariffs Commission (CTC) issued an order that members desist from engaging in restrictive practice of setting uniform prices for seed cotton bought from farmers.
CTC, however, last week said it intends to amend its order against the Cotton Ginners Association of Zimbabwe (CGA) in a move that will result in the setting up of a seasonal pool price during the upcoming season.
“The Commission, at the 59th Ordinary Meeting held on the 10th of December, 2014, resolved to amend its order in terms of section 31 (6) and the broad terms of the proposed amended order are as follows:
“(a) The ginners individually negotiate with contracted farmers on a seasonal pool price for seed cotton at the beginning of the cotton marketing season; and (b) that ginners adjust the price of seed cotton at the beginning of the cotton marketing season,” said CTC chairman Mr Dumisani Sibanda.
Statistics from the Cotton Ginners Association show that in the 2008/9 , the average price per kg was US$28.
ln 2009 /10 it was US$0,37, while the 2010 /2011 season was a good year for cotton farmers with ginners buying at an average price of US$0,91 per kg.
However, the following year prices tumbled to US$0, 37 per kg.
In 2012 /2013, merchants were buying at US$0, 50 and last year the average price was US$0, 60 per kg.
ZFU however, said the order leaves farmers at the mercy of ginners as it did not take into consideration the fact that cotton producers are smallholder farmers, many of whom lack formal negotiating skills and market information necessary for them to get a fair price for their cotton output.
It also blasted contractors for cheating and short-changing farmers.
“The contractors are not being honest.
“They are giving farmers inadequate inputs yet they want to reap more than what they invested.
“The cost of production is too high in Zimbabwe compared to other countries, while the depressed international prices have also contributed to the decline in the number of farmers producing cotton,” ZFU president Abdul Nyathi said.
Research shows that about 200 000 small-scale farmers were engaged in cotton growing, with 98 percent of the crop being produced under various contract farming schemes in the previous season.
The figure is however, said to have gone down due to cotton producer price standoff, as well as a poor yield of less than 1 000 kg per hectare and poor rainfall distribution patterns.
Nonetheless, Zimbabwe has the potential to produce at least 600 000 tonnes of cotton at an average yield of between 1 500kg and 2 000kg per hectare.
