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Agribusiness

The Food Reserve Agency-FRA has announced that it will be buying a 50kg bag of maize at K160 for the 2022 crop-marketing season, which is an increment of only K10 from last year.

FRA Board Chairperson Kelvin Hambwezya said the agency has pegged the buying price for a 50kg bag of soya beans at K550, an increase of K50 from last year’s K500 and has maintained the price of a 40 kg bag of paddy rice at K200.

Speaking during a media briefing monitored by the Zambian Business Times-ZBT, Hambwezya explained that the agency intends to purchase at least 170, 000 metric tons of maize, 1, 500 metric tons of soya beans and 1, 000 metric tons of rice.

Hambwezya noted that FRA undertook a process of crop price scenario analysis and consulted with some key stakeholders in the agriculture value chain adding that the stimulus in price will enable farmers to adequately prepare for the upcoming agricultural season and further be motivated to increase crop production and productivity.

The Board Chairperson mentioned that FRA purchased 947, 777.55 metric tons of maize valued at K2.8 billion, 121.60 metric tons of soya beans valued at K1.2 million and 656.80 metric tons of rice valued at K3.2 million in the 2021 crop marketing season.

 

 

 

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The Food Reserve Agency-FRA has announced that

Companies

Nkana Independent Member of Parliament Binwell Mpundu says the Constituency Development Funds – CDF that was awarded to different constituencies for the first quarter (January to March 2022) are yet to be utilized because there are delays from the casual approach from the ministry of local government compounded by the attached guidelines.

The Ministry of Local Government is currently under the charge of Mazabuka MP Garry Nkombo. The minister has been conspicuously silent on leading the CDF process with limited to no updates on what exactly is being done to clear the blockages.

Mpundu said that even if constituencies push for more money now, they still have not exhausted the CDF for the year 2021, projects have not yet started, Imagine that “in my constituency Nkana, that’s when they are about award the contracts for the 2021 CDF” , he started.

In an exclusive interview with the Zambian Business Times – ZBT,  the Copperbelt MP said here are two things that are delaying the process, the cumbersome procedure which has been provided for through the CDF guidelines and the inertia and casual approach by the technocrats with the mandate of executing the project.

“Me as Member of Parliament working alongside my CDF committee, we end at identifying which projects must be done and the implementation. The procurement, contract awards and the releasing of funds is entirely done by the local authority, so the delay is purely because of lack of capacity by the local authorities”, he revealed.

He further added that going forward, there is need to have an honest conversation with the Ministry of Local government to relax there guidelines so that the process becomes less cumbersome. He stated that there is also need to push the local authority to capacitate them.

Mpundu stated that because of the delays, there is definitely going to be struggle to achieve developmental targets because this time, we are implementing the 2021 projects, so there is going to be an overload.

Some stakeholders are attributing the delays in disbursements of the CDF and the excessive tax refunds by ZRA to the mines as being the main reasons for the current liquidity “no money in circulation” challenges which is leading to low demand for goods and services.

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Nkana Independent Member of Parliament Binwell Mpundu

Mining

ZCCM-IH, an investment company itself has announced that it has opted to outsource a South Africa unit of Rothschild & Co (another investment firm) to assist it with the strategic review and determination of way forward of Mopani Copper Mines – MCM.

This follows yesterday’s Zambian Business Times – ZBT article that a Mining Expert Edward Simukonda challenged the investment company (ZCCM-IH) and the Industrial Development Corporation – IDC to no wait for foreign equity partners but timely source for the required $300 million to return the Kitwe and Mufulira Mopani Copper Mines to full production.

The Mining expert challenged ZCCM IH that the $300 million confirmed to the the required amount to return the large scale copper miner to full production and start contributing to forex revenue generation for the country is not so much money that it is stretch mark for them to fail adding that ZCCM and IDC have the capacity to source that funding.

IDC and ZCCM IH have a combined huge balance sheet running in  billions of dollars that could be leveraged to timely source for the required funds and get the mine to full production. The investment company has been accused of deliberately delaying the re-investment program to facilitate the turning over of the mine from the local management team in preference to targeted foreign equity partners.

And according to a statement made available to ZBT, ZCCM-IH has laid out a longer timeline than the three months deal timelines synonymous with similar deals. ZCCM-IH which currently has no substantive CEO and being guided by board chairperson Dorika Banda has stated that the process is expected to be concluded within a period of six to twelve months, during which time Rothschild & Co’s involvement will not disrupt any business operations at the mine.

The statement from ZCCM IH did not state the fees that would be paid to Rothschilds for these services and weather these are capped since the timelines are much longer.

The new Dorika Banda led board have shown little ambition to locally run and manage both Mopani and KCM opting to initiate moves that would require the partnership or turning over the mines to foreign firms as equity partners. ZCCM IH has not stated if they are unable to raise the required funds.

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ZCCM-IH, an investment company itself has announced

Markets

Minister of Finance and National Planning Dr. Situmbeko Musokotwane says Zambia will not secure the $1.4 billion bailout package from the International Monetary Fund (IMF) by June this year as earlier anticipated.

Speaking during a media briefing in Lusaka today, monitored by the Zambian Business Times-ZBT, Musokotwane however said government is confident that it will be able to seal the deal in September this year.

The Minister explained that the failure to finalize the deal by end of June is due to government’s delay in holding discussions with the creditors which leaves less time for the creditors and the IMF board to deliberate on the matter.

Musokotwane noted that the new timeline of closing the deal mainly depends on the discussions that are starting tomorrow between government and its creditors.

“I don’t think those discussions should take more than a month but then we also have another technicality which has arisen which is that even if the discussions go very quickly, say within a month, the IMF board as I have learnt this morning are going for summer recess. They are going for holidays, there is some time that is required for the management to deliver some papers to the board members so time must be allowed from the delivery of the papers to the time that the board will sit to discuss”, he said.

He mentioned that he is optimistic that the deal will be sealed in September because all the official creditors are now on board.

Speaking at the same event, IMF Deputy Managing Director Antoinette Sayeh said it should be encouraging and motivating that Zambia’s official creditors are getting together for the first time as a group tomorrow to dicuss the debt relief they will provide to Zambia.

Sayeh said this is a big step forward and is motivated by the effort Zambia has made to address its problems.

She noted that getting the document to the board will be the next big step forward which she anticipates will happen by early August.

 

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Minister of Finance and National Planning Dr.

Agribusiness

The Cotton Board of Zambia says the increased buying price for cotton will encourage more farmers to venture into cotton production.

Mount Meru, one of the biggest buyers of cotton has announced that it will be buying a kilogram of cotton at K15, which is an increase from the K10 that was being offered last year for the same quantity.

Board Senior Inspector Nyambe Kwalombota explained that the ginners are offering K15 for a kilogram of cotton because they feel farmers have been getting low prices for a long time, which has been discouraging many farmers from venturing into cotton production.

Speaking in an interview with the Zambian Business Times-ZBT, Kwalombota said the price increase would attract more farmers to the sector, which will also increase production adding that the board is happy with the price.

He added that if more farmers are motivated to grow cotton and the production increases, more people would be able to benefit from the production in various ways.

“One ginner came up with the price and the reason was they feel the price which was being offered to the farmers was low for a long time and the sector has been going down in terms of production. The major reason they have offered a higher price is to attract more farmers, for any farmer it will make a lot of business sense to grow cotton. ”, he said.

Kwalombota disclosed that the production of cotton is expected to increase from 24, 248 tonnes which was harvested last year to around 30, 000 tonnes this year according to the figures that have been submitted by all the players in the sector.

He said the weather was favourable last year as there was slightly more rain compared to this year but the farmers tried to do a better job this year therefore the expectation that the crop will be slightly better than last year’s.

“We have fewer farmers and less hectarage planted this year but slightly a better crop as compared to last year in terms of the growth, there are fewer farmers but the crop looks better compared to what it was last year”, he said.

 

 

 

 

 

 

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The Cotton Board of Zambia says the

Agribusiness

The Poultry Association of Zambia (PAZ) says the production of day old chicks has increased following government’s decision to lift the suspension on the issuance of export permits for day old chicks, stock feed and hatching eggs in March this year.

In January this year, PAZ revealed that the cumulative number of day old chicks that the hatcheries had drowned because of reduced demand for the birds on the market was 1.1 million, a situation that prompted the association to appeal to government to allow exports of day old chicks and hatching eggs to the region.

Association Executive Director Dominic Chanda explained that the opening up of the export market has not affected the availability or prices of day old chicks in any way as all the local players are able to access the chicks on the local market depending on the volumes they want.

Speaking in an interview with the Zambian Business Times-ZBT, Chanda noted that the Democratic Republic of Congo (DRC) remains the biggest market for day old chicks produced in Zambia, with a few parent stocks going into East Africa.

“The situation has gone back to normal in the sense that the market has expanded, production has also expanded, what led to the drowning was the restrictive market to the local players, with government opening up the export market, we are servicing both the local and export market”, he said.

However, the Sub-Sahara African Famers Organisation (SSAFO) said there is a drop in availability of day old chicks on the market adding that it is not surprising as this is something that usually happens during the cold season.

Organisation President Munyaradzi Mulonda said the delivery of orders between 25, 000 and 30, 000 are taking atleast three months noting that there have not been any price adjustments in the last three months.

“Export normally gets priority, the best commodity is exported and the worst commodity is what comes on the local market. Now if you go to these companies they ‘ve got two tiers, this is for export market, this is domestic and all those which have got defects, undeveloped yolks and things like that are the ones on the domestic market, the ones which are perfect are for export”, he said.

Mulonda mentioned that most people are skeptical about rearing chickens during the cold season due to the high mortalities experienced as well as the increased expenses to do with heating.

 

 

 

 

 

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The Poultry Association of Zambia (PAZ) says

Tech

Power utility ZESCO has disclosed that the local companies that supply wooden poles are not able to deliver the required number, specifications and quality of poles ordered, hence the reason why the utility has opted to import the poles.

This is despite earlier indications by both CFC and ZAFFICO that they are capable of meeting the order and that they had not been engaged by ZESCO before the company opted to shortlist and select foreign companies from South Africa and Zimbabwe to supply the poles.

Others local suppliers are accusing ZESCO of hiding behind the usual tricks in rendering of playing around with specification to justify the need to import and award tenders to foreign firms. It is a well know trick in tendering were some corrupt principals work backwards, you for instance find that local poles height is on average  15 meters and you indicate say 20 meters to disqualify the local pole suppliers.

But ZESCO has insisted that local companies are falling short on quality and has proceeded to award the tenders to foreign firms at the expense of local and even Lusaka Securities Exchange listed ZAFFICO.

Speaking in an exclusive interview with the Zambian Business Times – ZBT, ZESCO Spokesperson Henry Kapata said the local suppliers [ZAFFICO and CFC] have no capacity to supply 100% of the poles order and that they are unable to meet 100% pole quality requirement standards.

Kapata explained that this is not suggesting that ZESCO is ignoring local suppliers, but “what we are saying is that local suppliers are welcome. The local wooden pole suppliers are only capable of supplying 1.4% of the total requirement [that meets quality specifications], hence the need to go beyond borders”.

When asked by ZBT to disclose in terms of price points regarding which poles will have a more competitive landed cost between those supplied by local companies such as ZAFFICO and CFC compared to those to be imported from say South Africa?, Kapata stated that “the issue is not about who is cheaper but meeting the specifications of having quality poles.”

He said quality poles demand that a poles should be able to stand for twenty five years without having any challenges. “We go for quality and specifications, we may have certain local companies that are in business and if they are going to deliver poles that [are thin and] look like street pole lights, we cannot go for them. Am not saying there is anyone but specifications and quality is what will determine who to award the contract to deliver poles,” he said.

The ZESCO spokeperson said neither was he suggesting that the local companies cannot produce or supply quality poles,  adding they can, but they are not meeting the demand. So this is why we are saying how do we dismantle the back lock of 67,000 people waiting to be connected, are we going to wait for the 1.4% to become 100%?, he asked.

He said ZESCO will not go beyond boarders if the local are producing and delivering the quality poles. The challenge ZESCO is currently facing with the Local suppliers is that they do not meet the demand whenever they are engaged.

ZESCO attributes this to the growth in the demand for power when it comes to connectivity and infrastructure development. Kapata further wondered what has changed now that a lot of people are questioning ZESCO when the utility has been importing poles since time immemorial.

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Power utility ZESCO has disclosed that the

Mining

A Mining expert has challenged ZCCM-IH and the Industrial Development Corporation – IDC to not wait for foreign equity partners but timely source for the required $300 million to return Mopani Copper mines to full production and expansion as they have the capacity to raise the needed funds.

Both Mopani Copper Mines Management and Mines Minister Paul Kabuswe have confirmed that Mopani needs about $300 million capital injection to make the mine fully productive and enable the company to complete its expansion project in a bid to double production.

At the time of the buy back transaction in January 2021, then ZCCM IH Board Chairman Eric Silwamba stated that ZCCM IH has acquired 90% shares in Mopani Copper Mines which were previously held by Glencore (73.1%) and First Quantum Minerals (16.9%), in line with ZCCM IH strategic plan to increase its holdings in existing mining firms.

Silwamba further stated that Mopani Copper Mine underground operations in Kitwe have a remaining life of 26 years and 16 years for Mufulira based Mines, with 110 million tons of proven copper ore reserves, with 1.89% of Copper grade.

And speaking in an exclusive interview with the Zambian Business Times –ZBT, Edward Simukonda a mining expert attributed the delay in sourcing for these funds to the responsible companies not seriously engaging with probable funders.

Simukonda said $300 million is not an amount of funding that can be said to big stretch for them to fail adding that ZCCM-IH and IDC have the capacity to source that funding. “There is need for patience yes but as for ZCCM-IH and the IDC,  am not sure they are seriously negotiating or looking around to find the propable source of funding for both Konkola Copper Mine and Mopani copper.” He said.

Simukonda Said there is a lot that needs to be done and there is need to exercise a little bit of patience as the stakeholders have to be sure of what they are doing or what they will put themselves into. But own thing that is clear is that ZCCM-IH and IDC have the capacity to raise $300 million.

IDC has a serious balance sheet that is in billions of dollars, so raising the needed funds are within its reach. When the deal to buy back Mopani, there were indications that the mine would be locally run but that story has since died. See link for full article on buy back intensions ZCCM IH buys back Mopani

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A Mining expert has challenged ZCCM-IH and

Agribusiness

The Small Scale Farmers Development Agency – SAFADA has disclosed that it is confident that the Food Reserve Agency (FRA) will be realistic and increase the maize floor price for the 2021/2022 crop-marketing season to take into account the increased cost of production.

However, the increase in the FRA maize price is feared as it is expected to trigger a domino increase in the price of mealie meal – Zambia’s staple food, a well known and highly charged political issue. But the situation on the ground leaves limited wiggle room for FRA as input costs have increased, some having doubled within the year.

SAFADA Executive Director Boyd Moobwe said SAFADA does not expect FRA to maintain the K150 that it was buying a 50kg bag of maize in the 2020/2021 crop-marketing season as the cost of production for farmers went up last year due to the increase in prices of fertilizer, seed and other inputs.

Speaking in an interview with the Zambian Business Times – ZBT, Moobwe said FRA should raise the buying price for a 50kg bag of maize from the previous K150 to atleast K200 so that farmers can cover their cost of production as well as realize some minimal profit.

Moobwe noted that if the farmers take into consideration everything that is involved in the production of maize besides the inputs, K250 would be a reasonable price for the purchase of a 50kg bag of maize this year.

Analysts say the ministry of Agro also has to be cognizant that farmers will need to use these sales proceeds to buy fertilizers, seeds, chemicals and other inputs whose prices have increased to be able to make their Agro businesses sustainable.

“Our expectations are quite high, we have confidence that FRA will give us a good price, we don’t expect FRA to maintain the K150 per 50kg bag which will be a mockery to farmers, so if they can raise it up to K200 and above, it will be much better”, he said.

He explained that the farmers were buying a bag of fertilizer between K600 and K700 therefore the need for government to raise the buying price to K250, which may not even be enough when the farmers look at how much they spent on seeds, ploughing and weeding among other things.

Moobwe has appealed to government to support other alternative measures of crop fertilization and encourage farmers to use other products such as liquid fertiliser, which has been proven by Mount Makuru research and other organisations as well as farmers.

Government had in 2020 hinted on putting through regulatory mechanism to allow FRA or set up an independent body to act as a marketing agency that would directly buy and export maize so that some of the benefits can trickle down to farmers, but red tape continues to hamper progress.

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The Small Scale Farmers Development Agency -

Markets

The Southern Africa Development Community-SADC Cross Border Traders Association says the signing of Statutory Instrument (SI) No. 36 of 2022 does not formalise most of the trade happening between Zambia and the Democratic Republic of Congo (DRC).

Association Executive Director Jacob Makambwe said the Zambian side of the Sakania border does not have the infrastructure that can facilitate smooth trade between the two countries and clearly shows that there are no business activities taking place at the border.

Last month, Acting Finance and National Planning Minister Paul Kabuswe signed Statutory Instrument No.36 of 2022, which now includes Sakania border among the borders through which goods for export can exit Zambia into the Democratic Republic of Congo.

Speaking in an interview with the Zambian Business Times-ZBT, Makambwe explained that just signing an SI to formalise trade is not enough and traders want to see government put up infrastructure that will facilitate trade between Zambia and DRC otherwise Sakania border will just be a passage.

“On the DRC side you could even see that they have even put where they are parking the trucks, there are truck parks-the concrete where the trucks are actually parking and we are actually seeing the buildings, the warehousing buildings so it means that those people are ready to do business”, he said.

Makambwe noted that the association understands that signing the SI entails that there will be increased business between Zambia and DRC using Sakania border but lack of infrastructure will make people feel Kasumbalesa border is better than Sakania because it may only be utilised by the truck drivers.

He said government needs to prioritise border infrastructure, which is automated like the one-stop border post adding that improved infrastructure will improve both the security and facilitation as well as bring about meaningful development and income to the country.

Makambwe added that the advantage of a one-stop border post is that it facilitates quicker clearance and movement of goods and services including people.

“Sort out the security issues with DRC; sort out the infrastructure which is lacking especially on Sakania border, sort out the road infrastructure between Zambia and DRC, Kipushi road going to Kolwezi. The road infrastructure must be prioritized, border infrastructure must be prioritized, there is need for improvement and putting up of proper border management infrastructure”, he said.

He has appealed to government to address the security issues affecting Zambia and DRC as gruesome murders of Zambian truck drivers as well as other people trading in the DRC have continued.

“If DRC does not want to formalise in terms of security issues or deal with security measures that we keep on complaining about there is need for government to build a dry port. It should be a one stop port, all goods taken to DRC are supposed to be cleared in Chingola, away from the border crossings so that activities that bring conflict are dealt with inland other than at the border where there is fragile security”, Makambwe said.

 

 

 

 

 

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The Southern Africa Development Community-SADC Cross Border