Market discipline: Hallmark of successful agricultural marketing

01 May, 2022 - 00:05 0 Views
Market discipline: Hallmark of successful agricultural marketing The GMB issues movement permits for transportation of any maize of more than five bags (50kg capacity per bag)

The Sunday Mail

Word from the market with AMA

The agricultural marketing season for grains and tobacco is upon us, with that of cotton imminent. The Government has already announced the floor producer prices for maize, soya bean, sunflower and traditional grains.

Market discipline remains the hallmark of a successful agricultural marketing season. In Zimbabwe maize, soya bean, wheat, barley, cotton and tobacco are classified as controlled products.

This means that farmers and buyers must ensure deliveries are made to designated or registered entities such as auction floors and the Grain Marketing Board (GMB). The control of certain agricultural products enables the Government to build strategic reserves mainly to ensure the nation is food self-sufficient.

The Government, through the Ministry of Lands, Agriculture, Fisheries, Water and Rural Development, has called upon all growers/producers, contractors, traders and other stakeholders at large to avoid side marketing of all controlled agricultural produce or crops.

Side marketing usually takes place when parties to the contract farming arrangement violate the agreement, either when a farmer sells to other contractors/merchants or when a merchant buys from farmers it has not contracted.

Side marketing is illegal in terms of the laws of Zimbabwe.

Maize is a controlled product in terms of the Grain Marketing (Control of Sale of Maize) Regulations, 2019 (Statutory Instrument 145 of 2019).

The control applies to all the 10 provinces of the country. Maize deliveries must be made to registered contractors and ultimately to the Grain Marketing Board.

Registration of contractors is done by the Agricultural Marketing Authority (AMA). The movement of maize is thus also controlled. The GMB issues movement permits for transportation of any maize of more than five bags (50kg capacity per bag).

The police have the power to seize any maize transported without the movement permit. It is actually a criminal offence to purchase, store, exports or otherwise deal with maize other than for personal consumption.

A conviction attracts a fine of up to three times the value of the maize concerned or to imprisonment for a period of up to two years.

Similarly, soya bean is also a controlled product in terms of the Grain Marketing (Control of Sale of Soya Beans) Regulations, 2021 (Statutory Instrument 97 of 2021).

All soya bean produced under contract farming arrangements shall be transported either to the GMB or for authorised uses. Movement permits from the GMB are also required.

Like in the case of maize, the possession, selling disposal or exporting of soya bean in any other manner not authorised under Statutory Instrument 97 of 2021 is a criminal offence which attracts a jail term of up to two years.

The law enforcement agencies have the power to confiscate all illegally possessed soya bean.
Stakeholders in the tobacco industry raised concern over the issue of side marketing. The Tobacco Industry and Marketing Board (TIMB) is the regulatory board that controls the production and marketing of tobacco in Zimbabwe.

TIMB lobbied Government and the Tobacco Industry and Marketing (Prohibition of Side Marketing) Regulations, 2022 (Statutory Instrument 77 of 2022) were gazetted this year. The regulations prohibit side marketing of tobacco. In this regard, all contractual arrangements must be respected by both the farmer and the contractor.

The regulations further provide that a contract grower is only authorised to sell contracted tobacco to their contractor and to no other person unless payment has been made in full. Registered buyers are also not allowed to purchase contracted tobacco prior to the grower extinguishing their contractual obligations with their own contractor.

In the same vein, all auction floors must not entertain the buying of any tobacco that has been contracted and the grower has not met its contractual obligations in full.

It also constitutes a criminal offence to deal with tobacco outside the regulatory framework and penalties include imprisonment for six months or level 5 fine and revocation of licenses.

Government’s thrust is to revive the once- vibrant cotton industry, hence cotton was also classified as a controlled crop in 2021 through the Grain Marketing (Control of Sale of Cotton) Regulations, 2021 (Statutory Instrument 96 of 2021).

The marketing of cotton must be done through contract farming arrangements. Like in the case of tobacco, cotton buyers can only acquire cotton from contracted farmers. The acquisition of cotton grown under another contractor is strictly prohibited and any violation of the rules attract a jail term of up to two years as well or a fine up to three times of the value of the cotton.

It is therefore critical at this stage in the marketing season of grains, tobacco and cotton to advise all stakeholders to maintain discipline by simply following laid down procedures to ensure the success of the agricultural industry.

Side marketing equally destroys the industry and must be shunned by all.

This article was written by Peter Mudzimiri, AMA head of compliance. Word from the market is a weekly column produced by the Agricultural Marketing Authority. Feedback [email protected] or [email protected]

Share This: