Zam­bia’s Cot­ton earn­ing to rise to USD220mil­lion...

Zambian Business Times - - FRONT PAGE -

Zam­bia ex­pects to har­vest 120,000 tonnes of cot­ton worth USD220mil­lion this year. This was es­tab­lished by the Cot­ton Board of Zam­bia in a state­ment is­sued by its Ex­ec­u­tive Di­rec­tor Da­fulin Kaonga....

Zam­bia ex­pects to har­vest 120,000 tonnes of cot­ton worth USD220mil­lion this year. This was es­tab­lished by the Cot­ton Board of Zam­bia in a state­ment is­sued by its Ex­ec­u­tive Di­rec­tor Da­fulin Kaonga. The board ex­pects Zam­bia to earn USD220mil­lion at cur­rent mar­ket prices of USD1.83 per kilo. Kaonga agreed with the Cot­ton As­so­ci­a­tion of Zam­bia’s – CAZs con­tention that there is need for gov­ern­ment to de­vise vi­able poli­cies and ramp up in­vest­ment in the sec­tor. There is need for gov­ern­ment to pro­vide an at­mos­phere or en­abling en­vi­ron­ment that will at­tract lo­cal and for­eign in­vest­ment in value ad­di­tion op­por­tu­ni­ties such as tex­tiles and cloth mak­ing. This would then fur­ther boost lo­cal em­ploy­ment cre­ation and ex­port of higher value added prod­ucts.

Kaonga, said gov­ern­ment should re­view the cur­rent Cot­ton Act of 2005 which the board is cur­rently op­er­at­ing on to ex­pand its man­date so that it can sup­port the full value chain de­vel­op­ment. There is need to open up more tex­tile in­dus­tries, de­scrib­ing the cur­rent in­fras­truc­ture in Zam­bia as be­ing ob­so­lete.

When pressed on what his board has been do­ing to de­velop lo­cal value chains, Kaonga stated that the boards man­date only go as far as a point were cot­ton is sep­a­rated from the seed and lint and not reach­ing tex­tile. “We are think­ing that [ its time] to re­view the Act to ex­pand what the board can do, our hands are tied and that is what is on the ground right now,” he said.

He in­di­cated that some of the chal­lenges the board is facing in­cludes fluc­tu­at­ing pric­ing which is de­pen­dent on the in­ter­na­tional mar­ket sys­tem. The lo­cal com­mod­ity trad­ing com­pa­nies work back­wards, mak­ing farm­ers bear the risk of in­ter­na­tional price and cur­rency fluc­tu­a­tions. This is where there is a gap or a need to come up with price hedg­ing mech­a­nisms to in­tro­duce sta­bil­ity and pre­dictabil­ity in cot­ton pric­ing.

The Cot­ton Board Ex­ec­u­tive Di­rec­tor also pointed out the low pro­duc­tiv­ity by the farm­ers as the other big chal­lenge. The board has been work­ing with fi­nanciers to come on board and part­ner with the farm­ers with cer­tain ba­sic needs over and above mere fi­nanc­ing so that pro­duc­tiv­ity im­proves.

When asked how the board is funded, Kaonga ad­vised that board op­er­a­tions are funded by levies to the cot­ton in­dus­try and grants from the gov­ern­ment. He high­lighted the is­sue of famers get­ting high in­ter­est and ex­ploita­tive loans from dif­fer­ent fi­nanciers has since been min­i­mized.

“We have sta­bilised the sec­tor and man­aged to bring con­fi­dence in peo­ple to in­vest in cot­ton. To­day, in­vestors can come and part­ner with lo­cals as there is san­ity in the sec­tor,” this Kaonga said in re­sponse to a ques­tion as to how his board has tried to de­velop the cot­ton and tex­tile in­dus­try in Zam­bia.

Kaonga said that the Cot­ton Board of Zam­bia was es­tab­lished un­der the Cot­ton Act No. 21 of 2005 of the Laws of Zam­bia, but only started op­er­a­tions in 2009. The act man­dates the board to reg­u­late the cot­ton in­dus­try in re­la­tion to the pro­duc­tion and gin­ning of seed cot­ton; to reg­u­late the pro­duc­tion and mar­ket­ing of cot­ton and to pro­vide for mat­ters con­nected with or in­ci­den­tal to the cot­ton sec­tor.

Cot­ton in Zam­bia is grown mainly in the Luangwa Val­ley of East­ern and Lusaka Prov­inces, and the Gwembe Val­ley of South­ern Prov­ince. The other re­gions of Zam­bia which now has 10 prov­inces are yet to be ruled out as po­ten­tial ar­eas for ex­pand­ing .

Cot­ton (white Gold) ready for har­vest

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