Bak­eries op­er­ate at 45 per­cent

Chronicle (Zimbabwe) - - Business Chronicle - Bianca Mlilo

THE Na­tional Bak­ers’ As­so­ci­a­tion of Zim­babwe says ca­pac­ity util­i­sa­tion in the bak­ery in­dus­try has de­clined to about 45 per­cent from 55 per­cent last year due to the pre­vail­ing eco­nomic cli­mate.

NBAZ pres­i­dent Mr Give­more Me­soemvura said the pre­vail­ing eco­nomic cli­mate is one of the tough­est the sec­tor has ever faced with close to 20 small-medium bak­eries hav­ing closed shop.

“The in­dus­try is op­er­at­ing at 45 per­cent. The com­pe­ti­tion has be­come in­tense. It’s now dog eat dog.

“The big have swal­lowed the small and the fight for shelf space in the mar­ket has reached ex­treme lev­els to the ex­tent that it’s now re­vers­ing the gains of Gov­ern­ment’s af­fir­ma­tive ac­tion that has been made so far,” he said.

“We’re more than able to meet na­tional de­mand. Our in­stalled ca­pac­ity is 1,8 mil­lion loaves of bread and we’re pro­duc­ing 800 000 a day.”

The daily de­mand for bread has been steadily de­clin­ing over the years. Now it is down to about 850 000 loaves a day. Last year de­mand stood at one mil­lion loaves a day, while in 2014 it was at 1,8 mil­lion.

He said the sec­tor was also fac­ing chal­lenges in the pro­cure­ment of raw ma­te­ri­als, which are not lo­cally avail­able.

All raw ma­te­ri­als used in bread-bak­ing are not cov­ered un­der Statu­tory In­stru­ment 64 of 2016, which re­moves sev­eral goods that are lo­cally man­u­fac­tured and avail­able from the Open Gen­eral Im­port Li­cence.

Last year, NBAZ re­vealed that the sec­tor needed about $150 mil­lion min­i­mum work­ing cap­i­tal to re­main afloat.

He said bak­eries that man­aged to se­cure fund­ing from lo­cal banks and the Dis­tressed In­dus­tries and Marginalised Ar­eas Fund have man­aged to pull through although they are still op­er­at­ing below ca­pac­ity.

Ac­cord­ing to the Con­fed­er­a­tion of Zim­babwe In­dus­tries 2015 man­u­fac­tur­ing sec­tor sur­vey, ca­pac­ity util­i­sa­tion stood at 34,3 per­cent. — @ Bian­caMlilo

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