Dairy product imports drop 26pc, as high compliance costs bite
THE dairy sector continues to make progress in its push to fully actualise Government's import substitution drive with milk products imports dropping by 26 percent from 6,5 million kilogrammes over the period January to September 2022 to 4,9 million kilogrammes in the comparable period this year on the backdrop of rising production levels.
High compliance costs, however, appear determined to soil this commendable feat with stakeholders bemoaning the absence of a one-stop-shop for ease of doing business when they market their products.
On the positive side, the Zimbabwe National Statistics Agency (ZimStats) has since availed statistics showing that dairy products imports dropped from 6 531 172 kilogrammes from January to September 2022 against 4 862 092 over the same period this year.
In value terms dairy products declined 16 percent from US$21 648 633 to US$18 292 411. The decline comes on the backdrop of similar trends experienced last year when dairy product imports fell 16 percent to US$31 325 651 from January to December in comparison to US$37 171 772 in 2021. Over the same period volume of dairy product imports declined 14 percent to 9 105 095 from 10 639 972.
Finance and Investment Promotion Minister Professor Mthuli Ncube introduced a gradual substitution of dairy product imports through increased local production, coupled with simultaneous increase in the uptake of raw milk by processing companies from 70 million litres to 130 million per annum by 2025.
Government gradually reduced on a sliding scale milk powder imports starting at 75 percent in 2023 to 50 percent in 2024 and then to 25 percent by 2025.
Statistics from ZimStats also show that the country exported 2 346 843 kilogrammes of dairy products worth US$3 655 408 at an average of US$1, 56 per kilogramme over the period January to September 2023.
The country exports milk, cream, yogurt, buttermilk, curdled milk or cream, ice cream, butter and fresh cheese.
On the one hand, dairy stakeholders believe Government's failure to introduce a one-stop shop within its establishments is proving costly in compliance and negating the easy of doing business concept as they push to reduce costs of production. The current situation has left farmers unable to access services in a centralised place, which is costly in terms of time and money.
Delegates at a recent value chain review workshop held in Harare expressed growing concerns over the matter with Dairy Processors Association of Zimbabwe (DPAZ) secretary general Mrs Tendayi Clementine Marecha, saying import and export permits required in the dairy sector were too many and accessible in different offices.
“Too many licences and permits from the Ministries of Industry and Commerce, Lands, Agriculture, Fisheries, Water and Rural Development and Health and Child Care as well as Biotechnology Authority, Agricultural Marketing Authority (AMA) and Veterinary Services are required and this can deter business.
“There is need to establish a one-stop-shop where industry submits one application and gets all the necessary important licences and permits through the creation of an online systems for ease of access,” said Mrs Marecha.
She added that spares worth less than US$10 000 from listed suppliers should be exempted from the licences and permits requirements to facilitate urgent clearance for British Virgin Islands (BVI)-pre shipping inspections.
She said Statutory Instrument (SI) 222 of 2022 had reduced milk powder allocation in 2023 by 50 percent but milk production did not significantly increase as anticipated to cover the deficit required by the processors.
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