Current soya beans price attributed to availability

Soya beans closed off the month of May trading at $630 per ton, this is according to FNB Zambia’s Agribusiness Monthly Report for May/June 2022. This means soya beans was trading around K10 per kg.

This price is 14% lower than the previous month but is still 59% better when compared to the same trading period in 2021 and soya beans is still experiencing record pricing well above its trading price of $350 – $400 pre-2021.

FNB Agriculture Specialist Mwamba Chokolo said the price reduction was expected because the price of $700 or more was more reflective of stock availability (which was low) versus demand.

According to information made available to the Zambian Business Times-ZBT, Chokolo said if the Russia-Ukraine conflict continues, and local beans remain attractive in the region as an export option, the price will continue to respond to international supply movements adding that currently, Tanzania has increased its purchase of Zambian beans, which has added to the premium price on offer currently.

Chokolo noted that the price reduction therefore is due to improved stock available thus a lower price during the current period, which is still in the harvest phase of the market season.

He explained that despite the month on month reduction, a 59% year on year improvement is significant and the reasons for the distinct price difference stems from expected global supply disruptions because of the on-going conflict between Russia and Ukraine for which both parties to the conflict are notable global suppliers.

The Agriculture Specialist noted that traders have opted to secure their crop early, at a seemingly higher than expected price, but taken from a long-term view, the price of not having stock is worth the current price at which stock is being secured.

Chokolo mentioned that farmers are expected to make income that is much improved from the previous season but like maize, the gains made through favourable pricing are being eroded by the increased cost of production.

He noted that the commercial soya national yield ranges from 2.5 tons per ha to 3.5 tons per ha average-while smallholder farmers range from 1.5 to 2 tons per ha average adding that smallholder diversification has meant a lot more producers are looking to move from maize production to soya beans.

Chokolo added that key to this is irrigation support, which would ensure some hedge against dry spells, which are commonplace during summer cultivation noting that in the absence of irrigation support; notable stock of soya will continue to come from commercial producers who still deliver close to 50% of all beans produced in Zambia.

Soya beans closed off the month of

Limited access to seed affecting cotton production

The Cotton Association of Zambia-CAZ says it is working towards addressing the various challenges that have been affecting the production of cotton in the country.

Association Executive Director John Ngwenyama explained that cotton is a profitable crop but challenges such as access to certified seed and certified chemicals have contributed to the low production of cotton in the country.

Speaking in an interview with the Zambian Business Times-ZBT, Ngwenyama said the cotton seed is not readily available on the market and sometimes ginners give farmers recycled seed which cannot produce high yields therefore the need to provide farmers with certified seed.

Ngwenyama added that some of the chemicals given to farmers are not certified so this affects their ability to control the pests in their farms, which also contributes to the low yields.

He explained that the yield per hectare has reduced due to the aforementioned challenges because farmers harvest 300kg-500kg of cotton per hectare when they could be getting around 1500kg-2000kg per hectare if the right measures are put in place, a situation which is making it difficult for farmers to make a good profit when they sell their cotton.

The Executive Director said even if the ginners buy cotton at a good price, if farmers continue to get 300kg-400kgs of cotton per hectare, they will not be able to make a lot of profit but if they are given K15 per kg and they are able to harvest at least 800kg they would be able to make good profits therefore the need to work on increasing production.

“As long as it is still standing at 300kg-400kgs per hectare, even if we give them K30 per kg they will still not realise anything. If we increase the production they will make a lot of profit so it’s something that needs to be critically looked into and see how best we can be able to help our farmers”, he said.

Ngwenyama noted that the cost of production for a hectare of cotton is atleast K1000, which is inclusive of, inputs as well as labour among other things adding that ginners still have the power to decide the pricing of the commodity therefore the need to come up with a committee that will be looking at the pricing model.

He said to reduce side selling; the association has proposed to have a pricing model where ginners and stakeholders agree on a price model so that every ginner will not pay less than what will be agreed adding that ginners should offer farmers a good price despite not having a pricing model in place yet.

Ngwenyama also mentioned that if individual ginners pronounce a price far higher than other ginners, it will affect the other ginners because farmers would rather sell to the ginner who has offered a higher price which will be a loss to the ginners that offered financial support to those farmers.

He noted that Mount Meru is able to buy cotton at K15 per kg because it crushes it into oil and is able to realise some additional profit by doing so but other buyers may not be able to offer that price.

Ngwenyama has appealed to government to make agriculture extension officers available to farmers who are growing cotton and not just other crops such as maize in order to provide them with knowledge on good agriculture practices so that they are able to produce more yields.

He said the association has also proposed that each ginner has extension officers that will help farmers with the necessary knowledge needed to increase their yields.

The Cotton Association of Zambia-CAZ says it

Businessmen Costain Chilala, Hantuba throw out cane growers

A source has disclosed to the Zambian Business Times-ZBT that six leaders of the Kaleya Smallholders Company Limited (KASCOL) have been expelled after challenging businessmen Costain Chilala and Munakupya Hantuba over their acquisition of shares in KASCOL.

The executive challenged the illegal share transaction by KASCOL Board Chairperson Costain Chilala and his business partner Munakupya Hantuba and that did not sit well with Chilala who then influenced management to expel the leaders who are now supposed to leave Kaleya within 30 days.

Speaking in an interview with the Zambian Business Times-ZBT, the source who sought anonymity explained that the smallholder executive spoke to the media about their complaints concerning the shares that Chilala and Hantuba have in KASCOL, which is grounds for expulsion according to the Cane Farmers Agreement.

However, the farmers argue that they spoke to the media as shareholders complaining against fellow shareholders and not farmers therefore Chilala using his influence as Board Chairperson to expel the leaders is unacceptable.

“All along there have been wrangles as to how Costain Chilala, a commercial farmer found himself a shareholder of Kaleya which is meant for smallholder farmers. So last year the small holder went to seek for help through the Provincial Administration Office in Southern Province, with the help of the District Commissioner and a lot of irregularities were unearthed in the share transaction and the way KASCOL was operating in general”, the source said.

KASCOL was established in the 1980s as a government outgrower initiative scheme to settle 300 smallholder sugar cane growers and after attending successful interviews, 140 smallholders were initially settled for but currently there are 160 smallholder farmers at KASCOL.

After the selected individuals underwent and completed the compulsory six months sugar cane growing training, government provided land and the farmers were each allocated four hectares of the cane field and 0.5 hectares on which to develop their own settlement of residence on a basis of 14 automatic renewable leases.

Farmers were guided that the scheme would be handed over to them after they had paid in full the investment loans and interests to various stakeholders from the cultivation of sugar cane and they were advised to sacrifice 60% of their annual proceeds of cane sales towards KASCOL loans repayment thereby getting only 40% of what was due.

After the exit of African Development Bank, One of the five financiers, the remaining financers each had 25% shares in KASCOL and were all ear marked for exit and had to transfer the shares to the farmers by the year 2000 and no outsider was allowed to buy the shares except the farmers themselves.

In 2002, Grant Thornton was engaged by KASCOL to work out the financial exit option of exiting shareholders and having lived their purpose, BBZ and CDC had to exit in 2005. BBZ was first to give an exit notice and demanded for about two million pounds exit fee within a short time and CDC gave an exit notice too.

Justine Chinyanta, a Zambian businessman expressed interest in buying off the BBZ shares should the farmers fail to raise the exit fee and he went on and paid a deposit holding fee of USD 50, 000. Costain Chilala, a Board Member of BBZ and his business friend Munakupya Hantuba rushed to Kaleya and entered into a partnership with the farmers in order to acquire the shares that were being offloaded by BBZ and CDC, as the farmers had no money to pay the exit fees at the time.

Chilala partnered with the 160 farmers and promised to use his own money to pay out the BBZ and CDC exit fees. Kaleya Smallholders Farmers Association (KASFA) executive signed biased share purchase agreements for both BBZ and CDC shares and a Consortium of Growers Investment Holdings Limited (GIHL) and View Point Investment Limited (VPIL). Chilala immediately assumed chairmanship of the consortia and subsequently KASCOL board as the consortia was holding 50% shares in KASCOL at the time.

The KASCOL articles were immediately amended to suit the new structure and the clause that said smallholder farmers would own KASCOL was completely deleted.

Instead of Chilala putting in money as earlier promised, he made the consortia get loans from Stanbic Bank Zambia and paid off the exit fees and the consortia share certificate was used as security for the loan, which was against the earlier agreement.

The consortia could not declare dividends as all the monies were serving the loan and interests were becoming huge. Farmers were further asked to surrender 9% of their annual harvest income to pay off the loan and interest for three years when the other partners were not paying, which brought about disagreements.

The farmers engaged the MMD government who promised to look into the matter but nothing was done, they sought help from Patriotic Front (PF) government and several meetings were held with KASFA leadership, KASCOL shareholders and government representatives at Southern Province Administration office.

After several attempts to dialogue with KASCOL management failed, the smallholders’ leadership went to court over interference in Mazabuka magistrate court in 2019 and up to date the hearing has not yet taken place.

Efforts to get a comment from KASCOL Estate Manager proved futile by press time.

A source has disclosed to the Zambian