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Agribusiness

The Chicken prices are expected to go up following concerns from Poultry farmers who complained about the high cost of feed making them incur huge losses.

Farmers and traders in the poultry industry are now being encouraged to take action and stay informed about the rising cost of inputs to avoid incurring losses.

The Poultry Association of Zambia has advised poultry farmers to hike chicken prices amid the high cost of doing business that has trickled down to poultry inputs if they are to make a profit.

Speaking in an exclusive interview with the Zambian Business Times -ZBT, Poultry Association of Zambia Executive Manager Dominic Chanda charged that if farmers will not hike the price of chickens, they will continue incurring losses due to the high cost of inputs.

The Poultry Association of Zambia has urged farmers to pass on the cost of inputs to the chickens, as the price of inputs has continued to rise while chicken prices have remained static.

Executive Manager of the Poultry Association, Dominic Chanda, stated in an exclusive interview with the Zambian Business Times that if farmers fail to hike the price of chickens, they will continue to incur losses due to the high cost of inputs.

Chanda emphasized that the prices of inputs in the poultry industry have gone up, and if the prices of feed continue to rise, chicken prices must also increase.

“The prices of inputs in the poultry industry have gone up and definitely if the prices of feed go up, the chicken prices sometimes also tend to go up but we haven’t seen the chicken prices going up in the recent past, it has been static. If you are able to pass on the cost of inputs to the chickens then you will see that the prices of chicken tend to change but if you can’t pass on the cost then your price will still remain static and you will start making losses,” he said.

“Most farmers use three ranges of feed: the starter, grower, and finisher. So the prices are currently ranging between k500 to k600 depending on the location,” said Chanda. He also advised poultry traders to adapt to the changes in the prices of chicken amid the high cost of living and inputs to create a win-win situation for both the farmers and the traders.

“The price has moved because in 2022 were are looking at the price of feed of about k380. The issue is that things are just becoming expensive, traders should start thinking that cheaper things are gone. Everywhere you go things are becoming expensive,” said Chanda.

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The Chicken prices are expected to go

Markets

In a bid to steer inflation towards the target band and anchor inflation expectations, the Bank of Zambia (BoZ) has announced that it had raised the Monetary Policy Rate (MPR) by 150 basis points to 12.5 percent. This hike of 1.5 percent in the MPR is expected to lead to a rise in interest rates, leading to “no money in circulation”, which could have a significant impact on the economy.

This decision comes amidst a period of rising inflation in Zambia, which has been primarily driven by the high cost of essential goods caused by the high cost of fuel among others.  

The central bank has been grappling with inflationary pressures for some time now, with the latest data showing that inflation had risen to 13.2 percent in January 2024, above the target band of 6 – 8 percent.

Speaking during the monetary policy committee announcement and press briefing attended by the Zambian Business Times – ZBT, Bank of Zambia Governor Dr. Denny Kalyalya noted that the decision to raise the MPR was taken after a careful assessment of the economic landscape and an evaluation of the risks to inflation and financial stability.

Dr. Kalyalya recognized that the decision would lead to higher borrowing costs for businesses and households, but emphasized that such measures were necessary to ensure that inflation remains within the target band of 6-8% in the medium term.

The hike in interest rates will make borrowing more expensive, which could dampen consumer spending and investment.

Although the announcement has been met with mixed reactions from various stakeholders, while some business leaders have expressed concerns about the impact on their operations, the Central Bank said the move is a necessary step towards restoring macroeconomic stability and boosting investor confidence.

Dr. Kalyalya added that the Committee is encouraged by the continued fiscal consolidation efforts, progress on external debt restructuring, and improved prospects of increased investments, which are critical for the attainment and maintenance of sustainable macroeconomic stability.

Meanwhile, Dr. Kalyalya said the constrained supply of foreign exchange amid high demand underpins the depreciation of the exchange rate. “To moderate volatility and broadly support the importation of critical commodities, the Bank provided market support of US$215.5 million (US$184.1 million in mining taxes paid directly into the Bank and US$31.4 million from reserves)”

“In response to the ongoing challenges in the foreign currency market, the statutory reserve ratio was revised by 900 basis points to 26.0 percent effective February 5, 2024, from 17.0 percent in November 2023.” Remarked Dr. Kalyalya.

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In a bid to steer inflation towards

Agribusiness

The Zambia Meteorological Department (ZMD) put out a rainfall forecast for the period covering 10th to 19th February 2024. This forecast highlights the potential for serious rainfall deficits for three-quarters of the country set to be affected during the highlighted period.  This is t after a generally late onset of rainfall in some parts of the country.

The predicted dry spell is part of a wider El Nino weather pattern – El Niño is a climate pattern that describes the unusual warming of surface waters in the eastern tropical Pacific Ocean. As far off as those places sound, the weather pattern affects entire regions, in Zambia’s case, the event was predicted to and is influencing local weather.

On November 8th, 2023, the Famine Early Warning Systems Network (FEWS) published Southern Africa Security Alert: Strong El Niño will drive high needs across Southern Africa through early 2025, 2023. https://fews.net/sites/default/files/2023-11/Alert-Southern-Africa-ElNino-20231108.pdf

The brief outlines what is expected in terms of weather conditions and most importantly the potential consequences in terms of impact on populations in wider Southern Africa. Outside the FEWS report, locally Zambia has a well-established early warning system called Zambia Drought Management System – whose data, ideally relayed to the Disaster Management and Mitigation Unit (DMMU) – specifically, the National Disaster Management Committee which would outline and coordinate mutual-ministry action plan to deal with the potential fallout from the prevailing weather conditions.

The ZMD outlook comes at a critical time during Zambia’s farming season. The traditional planting time in Zambia used to be late October into the whole month of November depending on what part of the country you are in, however, this over time, has changed and planting has generally shifted from mid–November into early and sometimes late December. This means, the predicted 10-day dry spell falls at a critical time for crop development and will undoubtedly necessitate the downward revision of production estimates for the coming harvest. The scope of the area set to be affected by the dry spell encompasses all the most productive areas in the country including Southern, Central, and Copper Belt provinces thus the need for a revision of the expected production outlook.

The information needed for follow-up actions is available to avoid what is most certainly headed for a food crisis. In the absence of a communicated path, the known risk of the following steps can aid the DMMU kick starting its mitigation effort.

  1. Verify actual grain stocks available with the Food Reserve Agency, by law the FRA is mandated to maintain a strategic grain reserve of at least 500k MT. The FRA was established for this very event. A clear position on stock levels will allow the government, in the event of low stock make the decision to buy grain – though Taboo and taken as a sign of weakness the decision to buy supplementary stock during a region-wide weather event is only logical and practical. The timeliness of this decision has treasury and logistical implications due to the volumes in question. Zambia’s current economic fundamentals remain frail and a mismanaged event like this one only go to exacerbate this situation.
  • Increase public awareness, like the COVID Pandemic, a clear communication strategy must be implemented, and this should prevail until harvest – this prevents the sudden “realization “of low production among the general population which invariably leads to grain hoarding, and this may lead to sharp price increases food.
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The Zambia Meteorological Department (ZMD) put out

Agribusiness

Corruption suspicions have arisen after a day old Company, Golden Manela Investments Limited, based in Lusaka, was awarded eight lucrative contracts by the Food Reserve Agency (FRA) for maize sales amounting to 7,258.31 metric tons, worth K29,033,240.00.

According to audit findings by the Auditor General, Golden Manela Investments Limited based in Chamba Valley, Lusaka Province was incorporated on 23rd June 2022 and started trading with FRA on 24th June 2022.

This has raised serious questions about due diligence and transparency in the awarding of contracts by the FRA. How could a company that was incorporated just a day before be awarded such lucrative contracts, without any prior track record or experience in the industry?

The audit findings also revealed that, as opposed to the contract agreement, Golden Manela Investments Limited only collected a total of 5,336.10 metric tonnes valued at K21,344,386 from various FRA Depots in 6 Provinces despite it being based in Lusaka Province. This raises further concerns about the legitimacy of the contracts and the processes followed by the FRA highlighting the urgent need for transparency and accountability in the awarding of government contracts.

The Golden Manela Investments Limited case must serve as a wake-up call to the government to take action and restore public trust in the procurement process.

“An examination of Maize Sales Contracts entered into by the Agency and Golden Manela Investments Limited revealed that the company signed a total of eight (8) contracts for maize sales amounting to 7,258.31 metric tons valued at K29,033,240.00 during the period under review.”

“A review of PACRA documents revealed that Golden Manela Investments Limited was incorporated on 23rd June 2022 and the following day, 24th June 2022, the company started participating in maize purchases at FRA and was subsequently given maize sales contracts for 7,258.31 metric tons valued at K29,033,240,” the report revealed.

“It was therefore questionable how FRA conducted due diligence on a company that was incorporated on 23rd June 2022 started trading with FRA on 24th June 2022 and was awarded contracts for 7,258.31 metric tons of maize valued at K29,033,240 which it collected from six (6) other provinces despite it being domiciled in Lusaka Province.”

“An examination of maize collection documents from various FRA Depots revealed that Golden Manela Investments Limited collected a total of 5,336.10 metric tonnes valued at K21,344,386 from various FRA Depots in six (6) Provinces namely Lusaka, Southern, Luapula, Northern, Muchinga and Central Province despite Golden Manela Investments Limited being based in Chamba Valley, Lusaka District, Lusaka Province,” revealed the report.

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Corruption suspicions have arisen after a day

Companies

A recent report has revealed that the Energy Regulation Board (ERB) has accumulated a surplus of over K455 million.

According to the Auditor General’s report as of 31st December 2022, ERB- recorded surplus revenue of collective K455, 875, 182 for financial years 2020, 2021, and 2022 respectively.

The surplus was attributed to the improvements in debt collection and the increase in licenses issued in the petroleum and renewable energy sectors. The report however has indicated that ERB recorded deficits of K1, 527,410 and K13, 089,571 in 2020 and 2021 respectively, and a surplus of K44,031,611 in 2022.

 The deficit in 2020 has been attributed to bad debts provisions made on agency fees whereas the deficit in 2021 was attributed to the increase in the provision for gratuity and service benefits. The surplus recorded in 2022 was mainly attributed to growth in the energy sector.

The report further showed that a review of the Statements of the financial Position for the period under review revealed an increase in receivables by K55,691,986 from K35,696,660 in 2020 to K91,388,646 in 2022. It also revealed an increase in payables by K17,650,809 from K21,260,735 in 2020 to K38,911,544 in 2022.

With regards to Weakness in Enforcement, section 4(u) of Part II of the Energy Regulation Act No. 12 of 2019 states, “The functions of the Energy Regulation Board are to — (u) impose an administrative penalty against a licensee for violation of license conditions under a license held by the licensee, or for failure to abide by the directives issued under this Act or any other relevant written law; among others.” Section 52(2) of Part VIII General Provisions states, “If a person, on whom an administrative penalty is imposed, by this section, fails to pay the penalty within the time ordered by the Energy Regulation Board, the Energy Regulation Board may recover the penalty by action in a court of competent jurisdiction.” Further, the Enforcement letters have a clause stating that the penalty should be paid within seven (7) days of the receipt of the letter.

The report however indicated that amounts totaling K421, 450 charged as penalties regarding enforcement cases involving twenty-four (24) Licensees were not collected within the seven (7) days. It was further noted that there was no evidence availed to confirm that the affected Licensees were taken to court by the Board.

The report further noted that amounts totaling K498,955,555 were outstanding from three (3) entities in respect of license fees as of 31st August 2023. It was noted that out of the K498, 955,555 that was outstanding, 99.8% was owed by ZESCO Ltd.

Under staff-related matters, the report revealed that amounts totaling K1,734,219 were paid as responsibility allowance to eleven (11) officers who were appointed to the Integrity Committee for fourteen (14) months between November 2019 and December 2020. A review of minutes further revealed that during the period under review, the Integrity Committee had six (6) meetings, and was also not clear as to why management decided to pay responsibility allowance instead of sitting allowances which were paid to other Committees, thereby making the payment questionable.

It was noted in the report that section 11 of the Management and Non-Represented Staff – Terms and Conditions of Service 2020 of the Energy Regulation Board, (Acting Appointment, Additional Responsibility, Promotion, and Demotion) states, “All acting appointments whether for convenience or promotions and additional responsibility should be made in writing by the Director General before commencement of such appointments.” Further, Section 11.2.1 Additional Responsibility states, “To meet operational requirements, employees may from time to time be assigned alternative functions in addition to their normal duties at equivalent or higher grades than their substantive grade, and that where an employee is assigned additional responsibility for a minimum of ten (10) calendar days, he/she shall be entitled to be paid an additional responsibility allowance at 25% of the employee’s substantive salary on a pro rata basis.”

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A recent report has revealed that the

Companies

Airtel Zambia has continued making significant contributions to the education sector by working together to improve access to education for underprivileged children in Zambia. Their efforts have included providing educational materials, renovating school buildings, and offering scholarships to deserving students.

The latest contribution from Airtel, is the two classroom blocks that have been handed over to the Ministry of Education through the Zambia Open Community Schools (ZOCS)  in Sinyendeende village in Monze District of Southern Province. These blocks will provide much-needed space for over 400 pupils in the area, enabling them to learn in a safe and conducive environment.

Refurbished at a cost of over K320,000, Ministry of Education Permanent Secretary Joel Kamoko on receiving the classroom blocks said his Ministry and Government at large were always excited about partnerships that yielded great results to benefit the education sector.

Kamoko speaking through the Director of Primary Education, Mr. Kezala Mwale who represented the Permanent Secretary, said that the handover event demonstrated how much Airtel and ZOCS cared for orphans and vulnerable children by improving infrastructure in community schools in different parts of our country.

“As your Ministry of Education, such initiatives excite us as they respond to what our 8th National Development Plan that regards education as a basic human right – key in development. not only does education empower people but it gives them the knowledge and skills to broaden their economic and social opportunities,” Kamoko said.

Airtel Managing Director, Hussam Baday who handed over the refurbished block said his company always believes in transforming the lives of the less privileged people in the various communities.

“While we believe that good quality education is the most important tool for social and economic development in Zambia, we also believe that the environment where learning is happening should be conducive and welcoming for the learners. This is why our commitment to partnering with the government and others is important so as we can work together to improve the educational standards in schools across the country, “ Baday said.

And ZOCS board Chairman Victor Koyi said his institution was proud to share that through the partnership with Airtel, they had either built classroom blocks from scratch or refurbished the existing infrastructure as what was being witnessed.

“Our mission remains that of brightening prospects of community school learners by empowering community schools, building partnerships, influencing policy, supporting learners and creating conducive learning environments,” Koyi added.

Some of the refurbishments done to the classroom blocks that host over 400 children include flooring, providing of windows and doors as well as plastering of all classrooms.

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Airtel Zambia has continued making significant contributions

Mining

Vedanta Resources Limited the parent company of Konkola Copper Mines –KCM says the road map for the full operations of KCM awaits the conclusion of the scheme of arrangement which is a court process to approve payments that will be made to creditors.

The Zambian Government through the Zambia Consolidated Copper Mines Limited – ZCCM-Investment Holdings and Vedanta Resources Limited signed a shareholders and implementation agreement on the running of Konkola Copper Mines last year with expectations that productions will commence in the first month of 2024.

Speaking in an exclusive interview with the Zambian Business Times – ZBT, on when the Company is moving on-site, Vedanta Resources Limited Corporate Communications Director, Masuzyo Ndhlovu, said there are still some processes that are ongoing and the company is still waiting for the process to conclude before moving on-site to commence operations.

Ndhlovu said The next step to follow after the signing of two agreements is the Court process to do with the scheme of arrangement. “Of course, this is a court process that is about payments to creditors which have to be approved through court processes.”

“So once all those things are done it will entail withdrawing of the Provisional Liquidator(PL) as a new Board will be appointed  to give policy and strategic direction to KCM and once that is done it will be a signal that the board will now appoint a management team that will run KCM then Vedanta will start operations or effectively start running KCM.”

Ndhlovu said, “But as it is now, we are still in that transition period and we are yet to conclude on all those issues that I have mentioned. We are hoping that by January, we will be able to conclude on all those issues.”

Asked about the production target in the 1st year of running, Ndhlovu said, “It is difficult to tell at this point as there are a lot of factors at play such as modernizing machinery, completion of the works on the Konkola Deep Mine (KDMP) shaft 4 with the installation of the pump chamber at 1390ml (meter level) in short do due diligence on the entire asset and that will roughly give us figures or forecast on the production levels. At the moment we are relying on a report done by a Technical Advisor Hatch. There will certainly be a need for another audit or due diligence report because you have to look at the state of machinery which needs to be upgraded so that you can produce much more. So I feel that it will be premature for me at this stage to say anything about productions looking at different factors.”

Asked about the hatch report, Ndhlovu said the report will as stated by the Minister of Mines and Minerals Development, be made public after all processes are concluded.

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Vedanta Resources Limited the parent company of

Lifestyle

With the government seemingly running out of ideas on how to deal with the current cost of living crisis, the Jesuit Center for Theological Reflections – JCTR has advised the New Dawn government to consider some targeted ‘ethical’ price control measures.

In their commentary following the latest survey that has revealed a further escalation in the cost of living, JCTR has put out about three possible economic solutions.

JCTR stated that consistent with principles that underscore dignity, social justice, and environmental stewardship, the Centre strongly underscores the need for the following actions:

1. Support for Low-Income Households: The Zambian government should prioritize targeted support programs aimed at alleviating hardships faced by low-income households. This can be achieved through meaningful and robust social safety nets that ensure access to necessities, for every individual.

2. Ethical Price Control Measures: To prevent individuals from being exploited through frequent commodity price adjustments, it is imperative for the government to enforce price control measures. By monitoring and regulating the prices of goods, we can protect consumers and safeguard their well-being. In the same vein, it is critical that the Energy Regulation Board works towards establishing long-term policy stability in the energy sector. Frequent reviews of fuel pump prices, for instance, can contribute to uncertainty. It cannot be overemphasized that the creation of a more predictable regulatory environment can promote stability and attract investment.

3. Currency Management: The government’s priority should be to ensure stability by implementing policies and strategies for managing currency. By efficiently managing pressures and stabilizing the value of the Kwacha against convertible currencies, we can create an environment that supports sustainable development while also protecting the dignity of individuals.”

Addressing the challenges arising from living costs, pandemics, epidemics, and unpredictable rainfall patterns calls for a collaborative effort involving state and non-state actors through honest and open dialogues and consultations to collectively formulate strategies that foster economic transformation, social justice, environmental sustainability, and human dignity for all members of the society.

“We, therefore, implore the government to urgently address the rising cost of living, to take decisive actions to alleviate the prevailing suffering, and to endeavor to build a society that places a high value on dignity for everyone.” stated the JCTR report.

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With the government seemingly running out of

Lifestyle

The Jesuit Centre for Theological Reflection (JCTR) has raised concerns about the Zambian government’s commitment to improving the livelihoods of the poor, amidst the continued increasing cost of living.

Based on the JCTR’s Basic Needs and Nutrition Basket (BNNB) survey for a family of five seen by the Zambian Business Times – ZBT, there has been an increase in the cost of living for households in Lusaka which now stands at K9,556 representing a rise of K398 compared to December 2023, which stood at K9,157.

These significant increases were observed in both food prices and non-food categories, worsening the challenges faced by individuals and families, especially in the low-income category.

JCTR says the rising cost of living poses a threat to human dignity which underscores the significance and worth of every individual and questions the country’s commitment to the 8th National Development Plan, which aims to improve the livelihoods of the poor.

The report indicates that this also expresses concern over the escalating burden of living expenses, which directly undermines the human core values adding that it is crucial to recognize that having a life where individuals can afford their basic needs such as food, clothing, and shelter is a cardinal aspect of human dignity as the suffering goes to the core of an individual’s sense of self-worth and questions the country’s commitment to improving the livelihoods of the poor as spelled out in the 8th National Development Plan.

“We have witnessed how moments of crisis like Coronavirus (COVID-19) and the Cholera epidemic exacerbate pre-existing inequalities, pushing already struggling communities to a far worse position. The significance of prices for goods cannot be overstated, as they directly affect families’ access to basic essentials. These families often find themselves grappling with difficult choices, having to decide between putting food on their tables and addressing other urgent necessities.

“This predicament creates hardship and undermines the dignity of individuals, as they are denied their right to lead fulfilling lives that honor their values and that enable them to thrive.” The JCTR indicated.

“Furthermore, the unpredictable rainfall patterns witnessed in recent months pose an additional threat to an already dire situation, which might result in increased food prices.

It is crucial for the Zambian government to recognize the urgency at hand and to begin formulating strategies for providing relief for its citizens, especially the poor, who are already burdened by the high cost of living.

Given the severity of this situation, it is crucial that immediate and decisive steps are taken to address both the escalating living costs, made worse by a complex array of issues, with the most pressing being energy (fuel costs) and foreign exchange risks due to the nation’s dependence on imports.

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The Jesuit Centre for Theological Reflection (JCTR)

Mining

Local mine owners and players have complained of being left out as only elitist foreign mine owners, financiers and their representatives are having a say on Zambia’s mining industry at the mining indaba being held in South Africa.

The Emeralds and Semi-Precious Stones Mining Association of Zambia – ESMAZ has condemned the government’s decision to continue sideling local small-scale miners from attending regional forums like the African Mining Indaba which is annually hosted in South Africa.

ESMAZ has condemned the government’s decision to exclude local mining companies from such events, stating that it does not portray a commitment to supporting the real growth of locally owned sectors.

Speaking in an exclusive interview with the Zambian Business Times – ZBT, ESMAZ President Victor Kalesha has challenged government sincerity in their statements that they went to create linkages for small-scale miners when such indaba are held with mostly foreign-owned and controlled mining entities and financiers at the expense of growing local ones.

He noted that the lack of resources and the high cost of financing make it difficult for mostly local small-scale miners to attend such events, which are crucial for networking and exchanging ideas with potential investors.

As the African Mining Indaba is this year held in South Africa from 5-8 February 2024 under the theme “Embracing the Power of Positive Disruption for a Bold New Future for African Mining”, ESMAZ, however, feels there is a need for the government and even financial institutions participating support the creation of linkages for locally owned miners and help them be part of the event if Zambia is to meaningfully and inclusively develop.

Kalesha described the sidelining of small-scale miners from attending such events as a lack of priority by the government, stating that the government has failed to prioritize the importance of invving locals and small-scale mining in the country.

The ESMAZ President added that successive governments since time immemorial have always attended mining indabas while sidelining local miners.

Kalesha said Small-scale miners are important to the country’s economy, as they can bring back much-needed revenue to the country through exports once they have the right connections and networks.

 However, our local miners face numerous challenges that hinder their growth and productivity.

Kalesha stated that small-scale miners understand these challenges and have solutions, but they cannot be implemented due to various hindrances, some of which need urgent solution to be addressed.

Kalesha called for more engagement between the government and other investors to exchange ideas and come up with mechanisms to see where the country wants to be. Locals Zambians are mostly playing in the small-scale mining sector, so sidelining them means exports proceeds will continue not being remitted back to Zambia.

He suggested that the private sector could be brought on board to support the sector, as it has done with road construction, generating more revenue for the country.

Kalesha added that it is crucial for the government to prioritize the small-scale mining sector and create linkages to allow them to participate in such events adding that by doing so, the country can generate more [real] revenue and create more real jobs in the mining sector. Kalesha said,

“What we feel is that Government should create interest and promote their own small-scale miners to have networking and linkages at the mining Indaba because their going alone with some representatives of mostly foreign interests does not portray commitment to supporting the small scale mining sectors.”

“We need more engagement rather than just having indabas in the country without directions that will not lead us anywhere as we need indabas with directions. Where do we want to see ourselves in the next 5 years, for example, the government has a road map for the copper industry of hitting 3 million tons of copper production by 2031, but where do we want to see the gemstone and emerald sector so there should be engagements so that we come up with mechanisms of seeing where we want to be as a country.”

“Just singing of being the largest producer of emerald when no local Zambians are participating is not enough because the trickle-down is not even being felt, contributing as much to the economy, but if we have many more small-scale miners and locals getting involved in the production and exports, we will have much more revenue remaining in the country unlike it is in the current scenario.”

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Local mine owners and players have complained