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Agribusiness

The Dairy Association of Zambia – DAZ has disclosed that Zambia produces enough milk to satisfy local demand with some of the excess being exported informally to neighboring countries. DAZ say its members can satisfy demand and that there is no need to import milk.

Speaking to the Zambian Business Times – ZBT in an exclusive interview, Project Manager of the Dairy Association of Zambia Victor Ngandu stated that Zambia is one of the few countries in Africa that is self-sufficient in milk production.

He stated that the milk that is being imported into the country may be a scenario of using Zambia as a “dumping ground” as the prices at which the imported milk is landing is too low when you add the transport and logistical costs.

Locally produced milk is competitively priced and the only feasible explanation for low priced imports is that most of it is just dumped in Zambia because of excess production from where its coming from.

N’gandu further told ZBT that Zambia does not need to import milk as local production is sufficient. Yes, the country can import certain types of cheese, butter and other exotic diary products which are not locally available, but said there is no need to import fresh and processed milk.

Zambia now has capable locally based milk processing companies. Some of the top milk processing companies include FINTA, Lactalis (formally Parmalat), Varun beverages (cream-bell brands), Zam-milk and Trade Kings Diary Gold. So, local processing capacity is there.

He stated that DAZ does not support the importation of fresh and processed milk and has called on the authorities to consider this when issuing import licenses. Why should we import if our members who are locally based small scale, emerging and commercial diary farmers can produce enough?

Ngandu stated that Zambia is producing about 655 million liters of milk annually. Zambia does not face any deficit in milk production but due to the challenges in raw milk collections, the formally collected and accounted for milk is only about 70 to 80 million liters. Zambia is also importing approximately 5 million liters annually.

Threrefore, there is need for an approximately 200 additional formal milk collection centers or depots each collecting of about 2,000 liters per day to be established in Zambia either by a cluster of farmers or government or cooperatives to completely eliminate the imports and save the country foreign exchange outflows.

DAZ disclosed that the consumption of milk per capita is around 36 liters (that is each person is estimated to consume about 36 liters of milk per year), if you take the current population in Zambia of about 18 million, total annual production of it works out to be 650 million liters.

When asked to elaborate on the structure of the Dairy Industry, N’gandu told ZBT that Zambia has a large informal milk market. “ If you take the total milk production in the country of about 650 million liters, the major producers of milk are smallholder farmers who account for 80% of the produced milk while emerging and commercial farmers make up the balance of 20%.

But when you look at the processed milk market, which is where the better profit margins are, the ratio is flipped back as the commercial and emerging farmers accounts for 80% while the small scale only get the 20% slice of the market.

Commercial milk in Zambia is mostly produced in Central, Lusaka, Copperbelt and Southern provinces. The Diary Association members also produce milk related products such as yoghurt (both drinking and eating), fresh milk, pasteurized milk, UHT – milk, lacto, cheese, butter, milk blended drinks and milk cream.

N’gandu told ZBT that Milk is an affordable and a high nutrition supplement. And Diary farming is now a wealth creating Agri-business among Zambian. He stated further that Milk production is a notable contributor to the country’s GDP and has serious potential to drive foreign exchange earnings for the country.

He also stated that the dairy value chain is a major employment sector with jobs and diary business farm owners at different levels such as farms, milk collection centers, milk transportation, milk processing and milk marketing making economic contribution to the country.

A local milk processing company whose name has been withheld complained to ZBT that milk imports have flooded the market frustrating their efforts to expand local milk collection and processing.

They stated that they have planned investments which are now being threatened by some authorities who are issuing import permits without due regard for companies that have set base in Zambia. They challenged the companies who wish to sell products in Zambia to equally set based and invest into local production so that they can support local farmers and employment creation which are badly needed in Zambia.

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The Dairy Association of Zambia - DAZ

Agribusiness

The “Buy Zambia Campaign” Chairperson Rosetta Mwape-Chabala has disclosed that locally produced Agro products are now over 90% in both value and volumes being sold in key chain stores in Zambia.

Chabala has disclosed to the Zambian Business Times – ZBT in an exclusive interview that overall production of agriculture products in the country has increased in the past few months given that most of the food products are not being imported amidst the Covid-19 pandemic, hence Zambian producers have taken lead in production.

She said key chain stores like Pick n Pay, Choppies and Shoprite have also corroborated with the “buy Zambia campaign” team and are now ensuring that at least 40% of local products are sitting in chain stores and these are both manufacturing and agriculture products.

“All the meat products that you see in chain stores are being bought locally and not being imported. Some local companies done very well in production and this comes with an engagement of local farmers who supply vegetables, fruits among other products to these chain stores,” She said

She added that her committee is currently working on a local content strategy which will be turned into a policy and that this will guide local sourcing where both manufactures, wholesalers and retailers will be required to comply with the guidelines to be finalized.

Chabala said the strategy is being worked on in conjunction with the Ministry of Commerce, Trade and Industry as it is meant to support local inputs adding that a threshold of inputs will be provided to manufactures with at least 35% of local content to be able to access support from other local businesses or government procurement.

“There is quite a lot that we are working on which can even encourage Zambians to participate in big sectors such as mining and construction in terms of suppliers and producers, however it is a good strategy which can build up local content and contribute to the growth of the country’s economy at large,” She added.

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The “Buy Zambia Campaign” Chairperson Rosetta Mwape-Chabala

Agribusiness

The Workers’ Compensation Fund Control Board (WCFCB), National Pension Scheme Authority (NAPSA)and the Industrial Development Corporation (IDC) will jointly be investing about K100 million (about US$5.6 million) to revamp the Mwinilunga fruit processing plant.

Speaking in an exclusive interview with Zambian Business Times – ZBT WCFCB Head of Communications and Customer Service Maybin Nkholomba says WCFCB, NAPSA and IDC have joined hands to come to revamp the fruit processing plant in Mwinilunga which will cost k100,000,000

We are just returning from Mwinilunga, where we have joined hands with NAPSA and IDC to revamp the Mwinilunga Kalene Hills Fruit Processing plant. The three institutions will invest K100 million in that project and it will be commissioned this year in October, 2020.

Nkholomba also disclosed that the fruit processing plant will not be restricted to processing pineapples, but stressed that there are a medley of fruits that will be processed to support diversification and expansion of other fruit plantations.

The fruit processing plant will process pineapples of course as the major crop, but also oranges, mangoes and several other fruits that are grown in Zambia. It will have seven production lines including mineral water processing.

Furthermore, he said that the Kalene fruit processing plant will be a major boost to local farmers and also help create self employment opportunities. “It will have 1,500 out grower scheme for farmers, obviously it will bring about job creation in the region and it will create 40 to 50 direct jobs and obviously it will help revamp the economic activity within North-Western Province”, he said.

Apart from processing mineral water ant juice, the processing plant will also be able to produce tomato paste and the products from The Kalene Hills Fruit Processing plant will be enjoyed by both local and international customers.

“When those fruits are taken there, they will be processed into fruit juice, fruit paste and dried fruits mainly. Things like tomato paste will also be products that the plant would deliver. The products will be intended for both the local market and export”, he said.

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The Workers' Compensation Fund Control Board (WCFCB),

Markets

One of Zambia’s prominent economist, Yusuf Dodia, has urged the Zambian Government to quicken the process of rebasing its Gross Domestic Product – GDP in order to align it with the recent changes that the country’s economy has experienced.

Dodia said despite the country going through difficult times currently, it is important to measure its wealth every after few years to accommodate changes from both the domestic and global economy. GDP annual growth rates have been recorded from 2010 to 2019 and its only in 2020 when we expect the economy to contract to negative growth.

He told the Zambian Business Times – ZBT in an exclusive interview that challenges such as change in copper prices, insufficient electricity, raising inflation rate and the high cost of labor put pressure on the overall GDP number, hence the need to rebase it in order to take these pressures into account and get the net effect.

He added that rebasing GDP further gives a picture of the country’s economy to citizens and explains what is happening on the ground, therefore making it easier for them to know how wealth is generated and who it benefits.

“GDP rebasing is important because it focuses on what goods the country is producing and measuring its value, for instance countries like Zambia where about 80% of our GDP is being produced by less than 10 companies, it cannot directly account for the welfare of more than 17 or 18 million people”.

“Rebasing GDP gives it some level of connection to the domestic economy but we have to be careful with numbers. If we strictly look at it in figures, all Zambians are living as middle income people by GDP per capita term, but the realistic view is that a lot more of our people are poor and generation of the biggest amount of production feeding into the overall GDP number is only coming from the mining sector,” He said.

Dodia has since called on government to find ways of sourcing for funds from its bilateral donors or get into negotiations with its partners as rebasing the country’s GDP is an absolute necessity.

The rebasing of GDP is ideally supposed to be done every after 5 years in a bid to account for changes that have occurred in an economy over time. The rebasing provides government with information on the size and the composition of the economy, however Zambia last rebased its GDP in 2010 and the results clearly revealed that it was understated by 25%, a trend which experts project would be the case if rebasing is done in 2020 or 2021.

From 2010 when the last GDP rebasing exercise was done, Zambia’s largest mining company, First Quantum Minerals – FQM has come on stream, various landmark investments in tourism such as hotels, airports and resorts have since been opened with large Infrastructure projects launched from 2011 to-date are all expected to bolster the overall GDP number.

A revised GDP number also enable the setting of the correct tax revenue and non tax revenue collection targets. Tax revenue collection targets for instance are general set at 18% of GDP if efficient methods are employed.

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One of Zambia’s prominent economist, Yusuf Dodia,

Tech

Zambia’s power utility company ZESCO Limited has disclosed that it is currently assessing additional load shedding hours for all its customers owing to the loss of 130MW of power from the national grid.

The company had on August 08,2020 announced to its customers and the general public that is that there is a loss of 130MW of power from the national grid owing to a technical failure on one unit hence creating variations in adherence to the current load shedding hours until the situation is normalized.

And when contacted for further details regarding this fault, ZESCO Public Relations Manager Hazel Zulu told the Zambian Business Times – ZBT in an interview that ZESCO is preparing a report which will indicate estimated loss amount in revenue terms, additional load shedding hours from the current 10 hours per day and the duration in which the situation is expected to normalize.

In a statement released earlier, ZESCO has ensured its customers that it is working round the clock to assess the impact of the deficit.

She said the power utility company will further ensure that customers and the general public are kept informed on the implications of this development on the current load shedding schedule.

“We would like to thank our customers for their cooperation and patience and urge them to continue employing energy efficient initiatives such as completely switching off appliances when not in use, migrating to the use of energy efficient lighting and using gas for cooking,” She said

Hazel added that these power saving initiatives will help both the corporation and customers to jointly manage the current power deficit and ensure that the available power is shared equitably amongst all customers.

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Zambia’s power utility company ZESCO Limited has

Companies

First National Bank (FNB) Zambia, has partnered with two other organizations to offer COVID-19 Relief Support to national authorities. The three organisations jointly donated COVID-19 Test Kit items valued at approximately K900,000.

In a statement made available to the Zambian Business Times – ZBT by FNB Zambia Head of Strategic Marketing & Communications Clotilda Mulenga, FNB Zambia together with Hollard Zambia and Right-to-care Zambia made the donation to the Ministry of Health.

FNB Zambia CEO Bydon Longwe stated that “the collaborative effort is inspired by the South African Pandemic Intervention and Relief Effort (SPIRE) intervention and relief effort launched by FirstRand Limited, of which FNB Zambia is a subsidiary”.

“We hope and believe that this timely action will help the country assist national authorities and their partners in mitigating the impact of COVID-19 rapidly and at scale, especially at a time when we are beginning to see alarming spikes in the number of daily cases.”

The donation consists of items meant to assist technicians in processing lab results such as Nuclisens Easymag Lysis Buffer, Biohit Tips for Easymag, Nuclisens Easymag Ext Buffer 1, Easymag Disposables, Nuclisens Easymag Ext Buffer 2, Nuclisens Easymag Magnetic Silica, Nuclisens Easymag Ext Buffer 3, Qia-amp Viral RNA Mini Kit (Qiagen).

Speaking at the joint donation event, Hollard Zambia CEO, Paul Nkhoma said, “The success of our businesses is intertwined with the prosperity of our nation. It is therefore our duty, as active corporate members of society, to support and assist our communities where necessary to enable better futures. Therefore, we are pleased to have been able to present this testing apparatus as contribution to the proactive and decisive response to the pandemic.

Dr. Crispin Moyo, Managing Director, Right-to-Care Zambia added and said that “Right-to-Care Zambia (RTCZ) is dedicated to the health and wellness of the people of Zambia. In partnership with the Ministry of Health, RTCZ has been combatting the HIV epidemic in Northern, Luapula, and Muchinga provinces since 2016. We are pleased to offer our continued support to the Ministry of Health and call upon all Zambians to do their part in the relief effort. One Zambia, One Nation, One People,”

And FNB Zambia CEO, Bydon Longwe concluded that “It is our hope that this donation will go a long way to ensuring that we can effectively protect ourselves against infection amidst the COVID-19 pandemic. Further, we commend the Government’s efforts to keep our communities and the people of Zambia safe and express to them our profound gratitude for allowing us to contribute towards this cause and be part of the solution”.

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First National Bank (FNB) Zambia, has partnered

Mining

A Zambian company, Mutinta Jewellery has invested over US$3.2 million into a diamond and gemstone processing plant which is expected to manufacture jewellery from diamonds, gemstones and other precious stones.

The plant which is set to operate fully before end of August 2020 has projected production of over 15 to 25,000 carats per annum and is expected to directly employ about 200 Zambians at the plant while about 100 individuals will be indirectly hired.

Speaking during a tour of Mutinta Jewellery and Gemstone processing plant in Lusaka on July 30, 2020, Permanent Secretary in the Ministry of Mines and Minerals Development Barnaby Mulenga pledged the ministry’s support to the company as it is in line with government’s policy of value addition and empowerment of local entrepreneurs.

Mulenga is pleased that the development of the processing plant will promote value addition as the industry is currently exporting raw gemstones before processing, hence the set up of a local processing plant will enable small scale miners sell their precious stones in raw form, which can then Ben polished locally before exporting.

He said the ministry of Mines in conjunction with the Ministry of Commerce, Trade and Industry will enable trade facilitation for the company to easily penetrate the regional markets as this will help in developing the sector and generate more forex for the country.

“We want to pledge our commitment in supporting this company as this is a very good investment and will definitely bring in value addition, so we will help you with trade facilitation so that you have a market and its good you will be polishing already existing stones,” the Mines PS said.

He added that government therefore looks forward to the exploitation of Zambian precious stones and gemstones and has encouraged Zambian small scale miners to take advantage of this facility that will create a local market.

And Mutinta Jewellery Chairperson Msafiri Sinkala said the set up processing plant is meant to make Zambia a market place for diamonds, gemstones and other precious stones for Jewellery and empower small scale miners to bring their stones for processing and earn better returns on their efforts.

“We have also engaged experts from China who are transferring skills to Zambians and we have already started doing a test run for most of the machines and will want to make sure that everything is up and running without any problem before full operations begin in August,” He added. For more details contact email: info@zambianbusinesstimes.com

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A Zambian company, Mutinta Jewellery has invested

Markets

Top cement producer, Lafarge Zambia has confirmed the increase in its cement prices on the market by about 20% and has attributed the increase to the current macro-economic factors that the country is facing which have been exacerbated by the effects of the Covid-19 pandemic.

A random survey conducted by the Zambian Business Times – ZBT team showed that all cement manufactures have increased market prices in the last one week from as low as K95 per 50Kg bag to K125 per 50Kg and K81 per 50Kg bag to K119Kg respectively.

And when Lafarge was contacted for a comment, the company’s Corporate Affairs and Communications Manager Sarah Banda told ZBT in an exclusive interview that the company has increased the cement price in order to sustain business operations and ensure that it continues to provide quality cement to its valued customers.

She said the company’s operation and input costs have significantly increased, the most notable being maintenance, transport and packaging material costs which have increased by an average of 33% in the last six (6) months.

“It should also be noted that we don’t comment about the prices of competitor cement producers. We take pricing decisions unilaterally and primarily on the basis of our own business circumstances and conditions,” She said.

However, the market sentiment is that cement prices may increase further going forward and when asked if Lafarge is likely to increase or reduce its prices going forward, Sarah said pricing is determined by many factors including but not limited to escalation of costs hence pricing decisions will be dependent on the performance of these macro-economic factors.

Lafarge Zambia has been operating in Zambia for 71 years now with a wide footprint of projects and distribution outlets. Lafarge is part of the LafargeHolcim group, which is globally the largest cement producer in the world.

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Top cement producer, Lafarge Zambia has confirmed

Mining

Great wall cement, a brand name  one of the cement products for Baudot Cement Zambia Limited who were the only company whose cement prices remained unchanged has disclosed to the Zambian Business Times – ZBT in an exclusive interview that they are also increasing their cement prices effective tommorrow 1 August, 2020.

Baudot Cement Zambia Business Manager Mira Zheng told ZBT  that there has been a hike in gypsum prices from about US$30 per tonne to over US$75 per tonne, which is over 100% increase in a major input, which has forced the company to follow suite and increase its cement prices. Zheng stated that the company would like to keep the prices down but the price of gypsum which was mostly locally supplied has shot up.

There is shortage of gypsum locally and this is what is leading to the sudden sharp increase in prices. Baudot cement used to get its gypsum from Chambeshi metals but because the company had gone on care and maintenance [basically closed in terms of operations], there is a shortage and the suppliers who have it have hiked the prices by over 100%.

In January 2020, ZBT reported that ‘the announced shut down and placement on care and maintenance of Chambeshi Metals threatens to impact the construction industry negatively through price escalation as the company is the country’s major producer of gypsum, a key ingredient in the manufacturing of cement”.

Chambishi Metals, which is owned by Eurasia Resources Group – ERG produces gypsum which is used in cement manufacturing and is a very important ingredient. So if Chambishi Metals ceases production, the cement price will most likely go up because the manufacturers of cement have to resort to imports from South Africa and else where” – see ZBT January article…

Baudot Cement’s great Wall cement brand will increase its cement prices effective tommorow 1 August 2020 from K90 for a 50kg bag to K110 without delivery and K119 with deliverly within Lusaka.

The Zambian Business Times – ZBT had called for the amicable settlement between the owners of Chambeshi Metals, the Mine Workers Union – MUZ and the Zambian government in January 2020 to ensure that the company remains operational as it impacts heavily on the cost of construction in Zambia.

The country is currently undertaking huge infrastructure projects and most of the citizens have also engaged in residential and commercial building to plug the gap in housing and commercial building.

Now that its becoming clear what the reasons behind the sudden hike in prices is because of the closure of Chambishi metals, there is need for urgent efforts to resolve the operational challenges and agree on how full local gypsum production can resume immediately. There is need to restore or cut down the overall cement market prices which has gone up by over 30%.

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Great wall cement, a brand name  one

Markets

Zambia has recorded a trade surplus valued at about K1.6 billion in June 2020. This surplus however is on a reduced level from a surplus of K3.9 billion recorded in May 2020. On a month on month basis, the surplus decreased by about 60%.

This trade surplus basically means that the country exported more than it imported in nominal terms. Exports which mainly comprise of domestically produced goods decreased by 11.5 percent from K10,524.5 million in May 2020 to K9,317.2 million in June 2020.

Zambia Statistics Agency – ZamStats Statistician General Mulenga Musepa explained that the decrease was mainly on account of an 18.6% decrease in export earnings from intermediate goods, that include semi – processed copper.

Speaking at a media briefing attended by the Zambian Business Times – ZBT on July 30, 2020, Musepa said however that imports increased by 16.1% from K6,681.1million in May 2020 to K7.8 billion in June 2020 and that the increase in imports was mainly as a result of a 29% and 54% increase in imports of Capital goods and raw materials respectively.

He said the total trade for the period January to June 2020 increased by 5.4% to K96.9 billion from K91.9 billion recorded in the same period of 2019.

Meanwhile, Traditional Export Earnings (TE’s) decreased by 17.7% from K8.3 billion in May 2020 to K6.8 billion in June 2020 and in terms of share in total exports, TE’s accounted for 73.0% revenue earnings in June 2020.

Musepa said Non- Traditional Export Earnings (NTE’s) increased by 11.3% from K2.3 billion in May 2020 to K2.5 billion in June 2020 and in terms of shares in total exports, NTE’s recorded a 27.0% in June 2020.

He added that Refined Copper export earnings in June 2020 declined by 21.0% to K6,226.8 million from K7,883.0 million in May 2020 while Refined Copper export volumes in June 2020 declined by 25.8% to 61,052.6 metric tone (mt) from 82,287.5mt in May 2020. But “LME copper prices increased by 9.7% to US$5,742.4 per metric tonne in June 2020 from US$5,233.8 per metric tonne in May 2020,” He said.

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Zambia has recorded a trade surplus valued