Cotton companies under investigation
Jeffrey Gogo and Martin Kadzere, Harare Bureau
AGRICULTURE, Mechanisation and Irrigation Development Minister Joseph Made has threatened to bring all cotton marketing activities under Government control to prevent smuggling and side marketing by private firms, accused of causing disorderly marketing.
In an interview this week, Dr Made said his ministry had also opened investigations into allegations that some private buyers were under-cutting Zimbabwe’s efforts of growing cotton earnings by influencing farmers to divert the crop into foreign markets.
This follows an investigation by this newspaper, which revealed that Zimbabwe could have lost a significant amount of cotton to Mozambique as farmers along the border line areas prefer to sell their cotton in the neighbouring country where they are being paid in cash.
Several farmers who were interviewed in Chionde, Chiwenga, Kakono and Gairezi in northern Zimbabwe said cash shortages and poor mobile network connectivity along the border line areas were among the major reasons for smuggling of the cotton to Mozambique.
“There are companies that we understand are encouraging farmers to sell cotton across the borders,” Dr Made told The Herald Business, by phone, but refused to name the alleged entities.
“If these companies continue to do that; as Minister of Agriculture, I have the power to invoke the control of the crop. “If those who are directly involved in supporting the growing of the crop go into the position of undermining the Presidential Cotton Input Scheme, I will not hesitate to invoke a crop control measure,” he warned.
The cotton industry remains at crossroads due to the rampant illegal purchase of contracted cotton by unscrupulous merchants. During the 2015/16 season, Government financed the crop to the tune of $26 million but only a bought a third of 30 000 tonnes produced.
In the last season, the Government, through Cottco invested $42 million to finance cotton production during 2016/17 season, 61 percent above the previous investment.
This year, the Government secured $60 million with about 400 000 farmers expected to benefit.
Dr Made said “we will not sit and laugh” as public money spent capacitating farmers is whisked away into foreign lands by a few calculating companies.
“I would like to warn that companies that are doing that (encouraging surreptitious exports) are undermining the well-being of the country, they are undermining the resuscitation of industry, they are undermining the value chain of this country. We will not allow that,” he said.
Yesterday, Dr Made told the Annual National Agribusiness Conference that; “We have an obligation together with the law enforcement agencies to nip this practice in the bud.“That is illegal from a law enforcement point of view and we are going to be looking into that.
“Because if a company is facilitating cotton to be sold across our borders that is illegal. So we are going to put the necessary instruments to do that,” said Dr Made.
“It might even include invoking the Minister of Agriculture, myself, to control cotton. Don’t be surprised if that happens because we cannot afford as a State to have this behaviour.”
Industry players, however, said commercial and social activities in the communities along the border lines were difficult to regulate since there was no proper demarcation of the border. As such, the activities in one country transcend the border.
“This year Zimbabwe is losing the crop to Mozambique because of the prevailing cash shortages and payments methods,” said an executive with a local cotton company.
“But in the previous year, Zimbabwean companies were the ones benefiting because of better prices. It is very difficult to supervise the commercial activities within these communities.
“In some instances some companies in Zimbabwe contract farmers in Mozambique and vice-versa.”