Escalating prices of day old chicks explained

The escalating prices of day old chicks by over 100% within a period of one year has been sited among the key reasons leading to high cost of retail prices of live and dressed chickens in Zambia.

There has been public outcry following the increase in prices of day old chicks from a range of K5.50 to K6.50 last year 2020 to currently between K14.00 to K15.50 within a period of one year which has been blamed on limited supply and the Kwacha depreciation.

The limited supply is stemming from the country having very few commercial breeders which has resulted into local shortages. The export market demand has also been on the rise which has seen some breeders opting to export due to better prices.

Moreover, commercial breeders have specialised in imported layer and broiler chicken breeds whose prices are linked to the exchange rate as the parent stock, technical staff and breeder hatcheries have dollar denominated costs and components.

The Poultry Association of Zambia (PAZ) has revealed that the high capital requirement and lack of local financing solutions for setting up day old chicks breeder farms is the limiting factor which has prevented local farmers from venturing into the poultry breeding sector.

Poultry Association Executive Director Dominic Chanda said running a breeder farm also requires expertise and the cost of hiring experts to run breeder farms is expensive as it is more technical at a breeder farm level than it is at growing chickens.

Chanda said most of the experts running breeder farms come from outside the country as very few local people have the expertise or experience to run a breeder farm, which makes it expensive, adding that for instance, just to hire a Veterinary doctor to help run the farm is also costly.

Speaking in an exclusive interview with the Zambian Business Times – ZBT, Chanda said the various costs associated with managing a breeder farm have made it difficult for local people to venture into the business on a small scale, as it requires huge capital investment. So, there is limited competition in this sector due to some entry barriers.

He said the grandparent stock breeders, which produce the male and female parent line have to be imported from Europe, which is a very complicated process especially if being done at small scale business level.

“You have what are called breeder farms, you have what is called the hatcheries, you have a breeder farm for grandparents, you have a breeder farm for parent stock, then from there you have the hatcheries, these are all costly to set up and operate”, he said.

Chanda said individuals or companies running breeder farms also have to adhere to the local regulations because environmental issues also come in when setting up a breeder farm, so there is need to do the environmental impact assessment, which can also be expensive.

He noted that there are also inspections conducted by the councils and other relevant authorities who conduct inspections every after two months. All these regulatory requirements have costs which have been a hindrance to local businesses setting up alternative breeders.

However, Some researchers spoken to by ZBT have instead challenged local poultry farmers to be innovative by coming up with novel ways to bread local (village) chickens to fill up the gap and meet the growing demand of chickens.

Do we surely have to import parent stock when we have village chickens which are also on high demand? Let’s also challenge our local Agro experts and poultry farmers to instead look at how they can fill up the gap by setting up breeders for our local village chickens?.

Moreover, even if the over 100% price increase is being blamed on the local currency – the Kwacha which depreciated by about 61% in the same period, when you consider the fact that day old chicks prices have gone up by over 100% within a year when the Kwacha depreciated by 61%, there is more to it than meets the eye.

Blaming these price increments on the Kwacha depreciation alone is questionable. More to follow on village chickens

The escalating prices of day old chicks

Demand for medium size cooking oil processing plants up!

With the super high prices of industrial processed cooking oil on the market, smaller and medium size cooking oil manufacturing plants are now in business with their retail prices saving consumers about 30 to 50%.

And one of the leading suppliers of small and medium size cooking oil crushing and processing plants Saro Agro has revealed that the demand for the cooking oil crushing plants has continued to increase.

Saro Agro Industrial Limited says the demand for oil mill machinery has continued to grow and has outweighed the supply. This follows the escalating cooking oil prices from large scale processors as well as in chain stores.

Cacius Nchimunya, a Sales and Service Engineer at Saro Agro said the market for the machines is overwhelming and has led to supply being lower than the demand now, with most of its customers being farmers who buy more quantities, government ministries and Non-Governmental Organisations (NGOs).

Speaking in an exclusive interview with the Zambian Business Times-ZBT, Nchimunya said the company is working on increasing supply but the challenge is that due to COVID-19, suppliers are limiting the quantity that a company can get at a particular time which has made it difficult to increase supply.

He said the company has in stock one model of oil mill machines but in three sizes, which are 6YL-68 the smallest size, 6YL-80 and 6YL-100, the biggest size. He further said the oil mills can be either electric or diesel, with prices for the electric machines ranging from about K38,000 for the 6YL-68, K67,000 for the 6YL-80 and K81,000 for the 6YL-100.

He added that prices for the machines that use diesel range from about K48,000 for the 6YL-68, K69,000 for the 6YL-80 and K80,000 for the 6YL-100 noting that diesel machines are more expensive because diesel engines are more expensive than an electric motor.

He noted that both the electrical and diesel machines have a crushing capacity of atleast 85kg of feed per hour for the 6YL-68, atleast 150kg of feed per hour for the 6YL-80 and atleast 200kg of feed per hour for the 6YL-100.

He said capacity is not measured by the amount of oil produced due to different qualities of seed as different types of seed produce different quantities of oil as per 50kgs adding that a 50kg bag of seed with good quality can produce 20 litres of cooking oil.

Nchimunya mentioned that the company has a three months installment payment plan that allows customers to pay for the machines within three months and are only allowed to get the machines after the last installment payment.

“For three months, the price doesn’t change for a customer who is committed but when a customer goes beyond three months, by our standards when a customer exceeds three months, we have to consider him/her with a new price, of course at times due to customer service you may be considerate”, he said.

With the super high prices of industrial

Liquid fertilizer answer to cutting import bill – Orgachem

Zambia’s massive fertilizer import bill can be cut if the country can adopt the use of the latest technology in plant nutrition by pivoting to wide spread use of organic and liquid fertilizers.

Bulk fertilizer imports have been sighted as one of the key import items which is currently causing foreign exchange or US dollar outflow and causing the Kwacha to shed value.

The fact that the massive fertilizer import bill needs an urgent solution was confirmed by the Central bank – BOZ, when they sighted Agro input, petroleum and US dollar debt repayments as the three major contributors to straining the local currency and constituting the major forex drainers in Zambia.

One Agro firm – Orgachem Zambia Limited has proposed that the country which urgently needs to stabilize its currency and reduce on its import bill should consider a transformational approach and consider adopting the use of more technologically advanced and cost effective liquid or soluble fertilizers.

Orgachem Limited Chairman Ahmed Patel told the Zambian Business Times – ZBT in an exclusive interview that that his company does manufacture soluble fertilizer and European standard liquid fertilizers, which is both chemical and organic. He added that the company’s licenses are from Europe as this is new technology which may just be the solution for Zambia.

He said liquid fertilizer has advantages, which include covering a bigger area, cheaper than what is currently on the market, more effective as it is spread to the leaf rather than the soil and has different varieties, which will help both the soil and the plant.

Patel further said that soluble fertilizer is easy to manufacture and transport as it mainly comes in bottles, which are much easier to carry and is cheaper in terms of labour because it does not require very big machinery.

The Organchem Chairman mentioned that the company’s target is to reduce chemical fertilizers and encourage the use of organic fertilizers adding that the company uses vegetable waste, cow manure waste among other materials. These materials are locally available in Zambia.

He said the company rarely buys any raw materials from outside the country and strives to use the raw materials available in the country in order to keep the production costs low so that the fertilizer can be sold at a reasonable price. Orgachem range of fertilizers are sold below K200, which is almost half of the price for chemical fertilizers.

He however added that the company does import certain materials which are not available in the country but also gets some of the material the company uses to blend it’s fertilizer from its competitors as it tries to avoid importing materials because that increases the cost of production which might result in increasing the price for the fertilizer.

“People are no longer using the fertilizer that we are using here in Zambia, people are more into new technology which is liquid fertilizer, soluble fertilizer which are the things which am trying to introduce on the market”, he said.

Patel said the liquid fertilizer was introduced in January this year on the market and the company has been doing research on it for almost two years and have done trials in Zambia and Europe.

He said some small-scale farmers have responded positively to the fertilizer as well as commercial farmers, where some trails have been done. The company has also taken advantage of the current wheat season, and supplies some commercial farmers with the liquid fertilizer.

He added that the company will be able to decide what direction to take in December this year as they are still doing trails. He urged Zambian small scale farmers to try out this technologically advanced product.

Zambia’s massive fertilizer import bill can be

Cotton production expands by 20%

Agro production in Zambia is recording tremendous progress across most key food and cash crops. One such cash crop is cotton with yields expected to expand by about 20%. If such growth rates of over 20% are sustained over the next five years, it would spur the eventual re-development of the textile and apparel secondary industry in Zambia.

The Cotton Board of Zambia has disclosed that the production of cotton is expected to increase from 55,000 metric tonnes to 66,000 metric tonnes for the 2020/2021 farming season due to the increase in the planted area.

Board Executive Director Sunduzwayo Banda said there is more planted area this year compared to the previous year, which technically means there will be an increase in the tonnes to be harvested.

According to information made available to the Zambian Business Times-ZBT, Banda said there are currently 286,000 farmers across the country who are growing cotton, noting that the buying price for cotton this year which has increased to K7.5 per kg.

The Cotton Board of Zambia said there was an increase in production in the 2019/2020 farming season, which was because of the buying price, which was higher than the previous year.

Banda mentioned that the highest buying price, which was K4.2 per Kg for the 2019/2020 farming season encouraged more farmers to grow the crop and more were expected to venture into cotton growing because of the pricing, which has gone up this year.

He however said that the production could have been more but that some challenges such as the adverse weather conditions in some cotton growing areas some of which were flooded which led to fields been abandoned and a pest attack in the valleys of Sinazongwe, in Southern Province also caused low production in the 2019/2020 farming season.

“So the pest damage caused a loss in terms of what we were expecting, however we also have competitor crops like soya beans which were offering higher prices than what we were offering, so that also contributed to the key challenges in terms of production, he said.”

He also mentioned that the association is working on re-arranging the marketing strategy in order to have a more organised market, quality control in terms of inputs and improvements on the seed quality and the integrated pest management in handling pests in an effort to try to fully revive the sector.

Banda said Zambia had about 225,000 cotton farmers and this farmers are mostly based in the Northern, Muchinga, Eastern, Southern, Central and Lusaka provinces last year which has now increased to 286, 000 this year.

“We are not on the Copperbelt, Western, North-Western and parts of the Northern province due to the soil conditions and climatic requirements of the crop. Cotton needs 600-800 mm of rainfall, anything higher or lower than that, it will not grow properly. It also needs a temperature between 21 and 31 degrees centigrade, so those areas have temperatures as low as 11 and 12, others as high as 39 and 40 degrees, so the crop does not do well in such areas.

Agro production in Zambia is recording tremendous

Cooking oil prices have started coming down

A random survey conducted by the Zambian Business Times – ZBT have revealed that the prices of cooking oil have started coming down in retail outlets by about 10 to 20%. Even those companies that import crude edible oils seem to have also reduced their retail prices in anticipation of the landing of imported cooking oil to protect themselves from losing market share.

And the National Traders of Edible Oils Association says government’s decision to allow the importation of cooking oil is because the local producers admitted that they have no immediate solutions or plans to reduce the high prices of cooking oil on the market.

Association National President Sylvester Kaluwa said the Ministry of Agriculture, the Crushers and Edible Oil Refiners Association (CEDORA) and the Zambia National Farmers Union (ZNFU) among other stakeholders held discussions and agreed on allowing the importation of an initial quota of 9,000 metric tonnes of cooking oil.

Kaluwa said the local processors are unable to buy all the locally available soya beans grown in the country due to their limited crushing capacity. So, the issue here is locally installed crushing capacity which is low. People should understand that the increase in the price of the crude palm that is imported and used in the manufacturing of cooking oil which is currently being retailed is what has led to increased prices. The crude palm oil is imported, and as you know, the Kwacha has depreciated by about 60% within a period of one year.

Speaking in an exclusive interview with the Zambian Business Times-ZBT, Kaluwa said the association’s estimated prices of sunflower cooking oil once brought into the country will range between K300-K400 for a 10 litres container, K270-K300 for a 5 litres container, K170-200 for a 2.5 litres container and K130-K150 for a 2 litres container.

He said these are fare prices considering sunflower cooking oil is expensive and will be imported adding that different types of cooking oil will be brought into the country and should be landed at a price lower than K200.

“Palm oil will also be imported and a 5 litres container will land between K180 and K200. We will bring in soya bean oil, palm olein, palm kernel, canola oil”, he said. He noted that these estimated prices are based on the information the association has concerning the prices of cooking oil in the countries they want to import from and the landing price will determine the price of the cooking oil when brought into the county.

He further said cooking oil that will be imported from countries within the SADC region is likely to be cheaper than the cooking oil that will be imported outside the SADC region. Kaluwa said the imported cooking oil will be cheaper than the locally produced oil but the plan is not to reduce the sales of the locally produced cooking oil adding that local producers were given incentives, which will see them reducing their prices, by about 20%.

Kaluwa said the importation of cooking oil will bring about competition, which will benefit the consumers, and the association will be able to cut costs by not involving agents and directly supplying to retail stores such as Shoprite who sell directly to consumers.

He mentioned that due to allowing the importation of cooking oil, government has allowed farmers to export atleast 40,000 metric tonnes of soya beans. He said imports have begun and the placing of orders has also begun and the oil will take one to two weeks to land in the country if imported from countries within the SADC region and 20-25 days if imported from Indonesia or other Asian countries.

He mentioned that the finished product cooking oil will be imported from Malaysia, Indonesia, South Africa, Tanzania, Zimbabwe, Malawi and Mozambique.

A random survey conducted by the Zambian