Industry suffers as cotton output drops
THE cotton to clothing value chain has been distorted owing to low output of the crop in the 2015/16 farming season.
Oil expressers, textile and footwear manufacturing firms have been affected by the poor harvest.
Less than 30 000 tonnes of cotton were realised this season, according to Government statistics, the lowest harvest in the country after 43 643 hectares were put under cotton last summer cropping season compared to 74 446 hectares planted.
Zimbabwe Spinners and Weavers is one of the affected companies, which manufacture cotton cloth among other products.
While the company’s group general manager Mr Ryan Norman had not responded to questions e-mailed to him, sources within the company said capacity utilisation had dropped as a result of low cotton output.
Bata managing director Mr Ehsan Zaman warned that the giant shoe manufacturer might be forced to reduce production due to the cut in supplies of textiles, which the company gets from Zimbabwe Spinners and Weavers.
“We are not getting regular supplies of textile, which is one of the basic raw materials we need for our canvass production. We are not getting regular supplies from our supplier locally, which means if we do not have enough it will affect production as well so the option will be to import. As you know textiles are some of the items that have been restricted from importation and we are trying to talk to the Ministry of Industry and Commerce so that we can be allowed to import,” said Mr Zaman.
He said the company needs 5 000 metres of fabric weekly, which he said Zimbabwe Spinners and Weavers is failing to meet.
Oil expressers have also borne the brunt of low cotton production, which they say has contributed to an acute shortage of cotton seed.
United Refineries chief executive officer Mr Busisa Moyo said the company has resorted to coming up with soya beans outgrower schemes as an alternative to cotton seed.
“Cotton production has been on the downward spiral over the past years after the Chinese distorted the value chain there and this has affected the supply of cotton seed. For us to keep going we have launched soya beans outgrower schemes so that we can meet our company’s needs,” said Mr Moyo who also doubles up at the Confederation of Zimbabwe Industries (CZI) president.
CZI has identified the cotton – clothing value chain as one of the 18 key value chains to spur industrialisation.
As part of efforts to up production of the cotton sector the Government through the Ministry of Agriculture, Mechanisation and Irrigation Development has started giving relevant inputs including seed to farmers.
Also, the Government recently announced that the cotton producer price would be $0.55 per kg.
The Cotton Producers Association (CPA) said a favourable price would entice farmers to commit to going back to growing the white gold.
CPA vice chairman Mr Morris Mukwe said $0,55 per kg would be an ideal price.
“We appreciate the efforts being undertaken by the Government to promote the growing of cotton through availing inputs. However, there is a danger that some farmers like last season will receive the inputs for speculative purposes especially if the pricing of the crop is not addressed,” Mr Mukwe said.
“For farmers the viable price will be at least $0, 55 per kg. We also want to urge cotton companies to introduce the auction system because at the moment the cotton companies are operating a cartel where they buy the commodity using a price they have agreed amongst themselves in defiance to a ruling by the Competitions and Tariffs Commission,” he added.
Mr Mukwe said if the Government is to instil confidence in the sector it should compel Cottco, which paid $0,35 per kg for deliveries to commit to pay the $0,10 adjustment, which it said it would pay this month.
“Failure to pay the adjustments would erode the trust the remaining cotton farmers has on Cottco, which is the only company that has been paying farmers better,” said Mr Mukwe.
At peak production the country used to grow 435 000 tonnes of the white gold. — @lavuzigara1
Mr Busisa Moyo