THE 2014 to 2015 agricultural season success hangs in the balance as the Finance ministry revealed in a press statement that it was struggling to pay for grain deliveries to the Grain Marketing Board (GMB).
Most farmers depend on finance from the sale of crops to invest in subsequent cropping seasons as there is limited additional income from loans and grants.
The 2015 budget proposal by Finance minister Patrick Chinamasa projected agriculture to rise significantly by 3,4% based on expectations the agricultural season would remain positive while production in the main crops — maize, tobacco and cotton, among others — was expected to remain on an upward trend.
However, in the press statement released yesterday, the ministry said while it was ideal that farmers got their payment timeously for their various needs, including farming operations, the prevailing liquidity challenges had resulted in the government falling behind in payments.
At the onset of the cropping season, Zimbabwe Farmers’ Union president Abdul Credit Nyathi expressed concern to Southern Eye Business that farming implements had not been distributed to farmers although the Agriculture, Mechanisation and Irrigation Development ministry was working with Agribank to make the input scheme available.
The Finance ministry said as at December 19 2014, grain deliveries by farmers to the GMB under the 2014 to 15 grain marketing season amounted to 255 519 tonnes valued at $101,8 million.
“To date, the government has disbursed $57,6 million to GMB for payment to farmers for the grain delivered including $8,2 million for grain delivered during the previous season,” part of the statement reads.
“Of the $57,6 million paid by government, $51,5 million was raised through the issuance of Agricultural Marketing Authority (AMA) bills with the balance being paid from fiscal resources. The government’s outstanding obligations to farmers for grain deliveries now stand at $52,4 million,” it added.
According to the statement, the government in collaboration with AMA and CBZ Bank, had issued another lot of AMA bills targeting mobilisation of $50 million.
“However, these resources will not come at once but over time. Already against this issuance, $3 million has been raised towards liquidation of the outstanding amount to farmers.
“Therefore, as additional resources become available, they will be channelled towards payment of the outstanding amount to farmers in order to capacitate them to invest towards the 2014 to 2015 agriculture season,” the statement read.