State of the Nation: What the 10-Point Plan means to agric sector

Last Tuesday, President Mugabe presented a 10-Point Plan for Economic Growth in his State of the Nation Address.

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Peter Gambara

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MUGABEThe plan’s first two points are specific to agriculture and the question is: What does the framework mean to this sector?

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The first point talks about “Revitalising agriculture and the agro-processing value chain”.

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Agriculture contributes about 19 percent of GDP and helps sustain the livelihoods of over 80 percent of Zimbabwe’s population in communal, resettlement and other farming areas.

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It has always provided food, fibre and other raw materials to industry.

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It is, therefore, critical that we revitalise the sector so that it carries the burden that it has since time immemorial.

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In the 1980s, Zimbabwe was regarded a major food hub in Southern Africa, with small-scale farmers contributing over 75 percent of maize and 90 percent of cotton.

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However, the country only managed about 800 000 metric tonnes of maize last season.

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Our summer cropping seasons have increasingly become unreliable, as they are now shorter and susceptible to mid-term droughts due to climate change, thereby compromising yields.

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Therefore, Government and the private sector need to collaborate on establishing new and/or revitalising old irrigation schemes.

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Many such schemes are idle due to lack of maintenance and authorities should take the initiative to rehabilitate them.

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Irrigation schemes are well-known for having helped rural households to produce crops all-year round and being sources of sustenance.

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In areas where they have been set up, increased activity has been noted as folks sell part of their produce via several avenues, including major markets in the capital and horticultural markets in small towns.

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Standards of living in these areas are also better than in places where farmers rely on rain-fed agriculture.

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President Mugabe, in his address, said Government will from now onwards take a leading role in establishing new and/or rehabilitating irrigation schemes.

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And rightly so, a lot of water resources have not yet been exploited to the benefit of communities in their environs.

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More critically, small-scale farmers who continue to grow maize are facing a bleak future as payments from the Grain Marketing Board have been erratic lately, forcing farmers to either seek alternative markets or move away from growing the crop altogether.

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In the past, families would pay their children’s tuition fees using proceeds from the GMB.

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However, it can now take years for one to get such payment.

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With the right policy-decisions, incentives and support for small-scale farmers, maize production can be revitalised to peak levels.

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We just need to take a few steps back and consider how we used to produce bountifully and rediscover that formula.

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Surely, that can’t be impossible.

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For a change, GMB should be adequately capitalised to pay farmers promptly upon maize delivery.

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That will revitalise farming.

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Government has already taken the initiative to distribute farming and irrigation equipment imported from Brazil to small-scale farmers.

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The responsible officials should continue monitoring this equipment’s use so that Zimbabwe derive’s maximum benefit.

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Value chain

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Another crop that requires urgent attention is cotton where production has been going down as farmers remain in difficult circumstances yearly on the back of ridiculously low producer prices.

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Recently, Government indicated it would want to take back Cottco, previously known as the Cotton Marketing Board, which played a key role in the 1980s in contracting and buying cotton from growers.

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Cotton is grown by over 300 000 farmers in mainly dry or semi-arid regions that include Gokwe, Mutoko and Chiredzi.

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Subdued prices, therefore, have a negative effect on a lot of small-scale farmers as this leaves them with virtually no alternative cash crop to grow.

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It is important that Government revitalises the cotton industry – urgently.

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The agro-processing value chain refers to the whole set-up of input suppliers; financiers; service providers like transporters and garages; manufacturers and marketers involved in the production, harvesting, marketing and processing of agricultural commodities.

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Input suppliers include fertiliser, chemical and seed producers. Farmers will also need finance, machinery in the form of tractors and other equipment and labour.

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At harvest, combine harvesters are mobilised to harvest crops, which are then transported from the farm to the industry/manufacturing company for processing and bagging and then shipped for sale.

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Traders then sell the finished product to the public.

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The important point about this value chain is that a lot of industries are interdependent.

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If the area planted: crop ratio decreases, it means the inputs required will be reduced; output will be low and eventually everyone will feel the pinch.

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Revitalising agro-processing, therefore, means going back to the drawing board to see how each of the sectors can support the next for its own and the whole country’s good.

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Beneficiation

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The second point of the economic growth plan relates to “advancing beneficiation and/or value addition to our agricultural and mining resource endowment”.

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The President used “beneficiation” and “value addition” on the same point because he was referring to two sectors, agriculture and mining.

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In mining “beneficiation” is a process whereby ore is extracted from gangue, with the mineral ore being suitable for further processing.

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However, the term has often been used metaphorically to refer to economic development and corporate social responsibility and describe the proportion of value derived from asset exploitation that stays in a country to benefit locals.

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“Value addition”, when used in agriculture, refers to the manufacturing processes that increase primary agricultural commodities, for instance, spinning cotton into cloth or manufacturing cigarettes from tobacco.

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It may also refer to packaging, processing, cooling or drying processes that will differentiate the new product from the original raw material.

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Examples include packing milk, producing yoghurt, processing tomato paste or “mufushwa” (dried vegetables).

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Value addition also increases the economic value of a commodity through a particular production process.

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For example, instead of a farmer selling maize to the GMB, that farmer can use the maize to feed cattle, broilers or pigs and eventually sells the meat instead of the grain.

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Zimbabwe is the third largest producer of tobacco, but has traditionally always exported 97 percent of the crop, leaving a paltry 3 percent for local manufacturing purposes.

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By advocating value-addition, the President is rallying the private sector to increase, say, cigarette manufacture so that instead of exporting raw or semi-processed tobacco, they export cigarettes with a much higher value.

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A kg of tobacco that sells for just US$4 at the auction floors could fetch up to 10 times more when it has been processed into cigarettes.

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It is obvious Government cannot do this alone.

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If anything, it can never be the responsibility of Government as it is there to facilitate the required processes.

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Other crops we could process and sell as finished products include teas and coffee from the Eastern Highlands.

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Our supermarket shelves are overstocked with teas and coffees from outside the country.

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Whilst competition is acceptable, we may be shooting ourselves in the foot by opening our borders to anything that companies and individuals want to import.

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Imports should complement what we have locally, rather than have 80 percent of our shelves stocked with foreign products.

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It should be the other way round; 80 percent should be locally-produced goods, with imports comprising 20 percent.

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It is very clear why employment levels are now at record lows.

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We owe it to ourselves to correct the misconception that imported products are superior to our local ones.

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It always comes with a price; local companies will continue to close, with massive job losses.

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As we prepare for the 2015-16 summer season, it is time all the relevant stakeholders come together and strategise for a bumper harvest next year.

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These include input suppliers, financiers, labour, service industry, the farmers themselves, manufacturing and traders.

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It is possible for all these people to find a common cause of making the next summer season a huge success.

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We need to revitalise our agriculture, support each other in the agro-processing value chain and seriously consider value addition to our agricultural products.

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Mr Peter Gambara is an agronomist based in Harare.