Agriculture reporter yesterday weighed in on FRA maize purchasing price
Again, you will hear some overzealous reporters and cadres saying Bennie is attacking Government, no, Bennie is always against the FRA but folks, I don’t care. I am just a responsible Zambian who wants the best for his country.
Today, FRA has announced another ridiculous maize purchasing price of K110 per 50 kilogramme bag. Now, for those who don’t know, this is the same price at which FRA bought maize last year. A bit of background for you.
Last year, FRA’s target for maize was 300,000 metric tonnes but ended up buying a meagre 86,510.10 metric tonnes, representing only 28.8 percent. If your child is in school and is ever giving you 28 percent, just chop off his head and use it for rituals, make money.
What reason did they give us? They said the prolonged dry spells had a negative impact on the production of most crops. This is a lie!
Yes we know that there was a problem with rains in the 2018/2019 rain season but the real reason is that farmers opted to sell to private buyers because the price FRA was offering was ridiculously low compared to the cost of production and associated costs. I will leave it at that.
Back to this year’s crop marketing season. FRA in all their wisdom believe that putting a 50 kilogramme back of maize at K110 is commensurate with the costs of production. Listen folks, a bag of fertilizer is already racing towards K500. That is before we even add other costs farmers incur every season such as transport, seed, labour, time, and many other auxiliary costs.
There is another aspect that FRA needs to learn. Out of the 3.3 million metric tonnes the country has produced, half of it is always kept by farmers for consumption and so, what will be tradable is somewhere around 1 million or 1.5 million tonnes. Sooner or later, we are going to hear there is no maize around because private buyers have just been waiting like a lion waiting for an impala to get close and leap to devour it.
Private buyers were just waiting for FRA to announce their buying prices. By Monday, you will hear the prices that will be offered by private buyers. They will definitely offer more and paying instantly. Again, FRA will be shunted to Northern and Muchinga where the traders don’t usually don’t go to buy but get this from me, the entire crop from that region will not reach a million tonnes.
What this means is that FRA may not reach their target of buying 1 million tonnes of maize as most farmers will rush to private buyers who offer more, and pay instantly.
Don’t get me wrong, I am not saying that private buyers should not buy but the price at which they buy maize is determined by what FRA offers. If FRA offered K150 for example, private buyers would offer K160 or K165 and what this means is that the farmer will get value for their produce.
Sad that in their wisdom, FRA and its stakeholders think the country has enough maize and it will be easy to buy the quantities they want but just like last year, that won’t happen. FRA and its stakeholders think by offering these prices, mealie meal prices will come down but they are far from the reality because this also will never happen under the sun.
Know why? FRA will fail to reach the target while all the maize will be in the hands of private buyers who will mop every grain. That will create a shortage on the market because private buyers will then hold it until somewhere December or January next year and then, they will offer it at a very high price. The same maize being sold at K110 will fetch for over K200. Do you think the price of mealie meal will come down when most of the maize will be in private hands?
Last year, traders tested a bit of money by holding on their maize, waited for the time when it became expensive, and that is when they sold. This year, more will do so.
But the true loser in this whole maize matrix is a farmer. Farmers are supposed to get a good price for their produce at the right time so that they plan well ahead of the coming season but how do you explain a situation where a 50 kilogramme bag of maize is sold at K110 while the same quantity of fertilizer is sold at K50?
I rest my case. Those of you who are sniffing around for what I post in order to get paid, you can go and tell whoever you want to tell. I have not insulted anyone. I have just stated facts and I welcome you to a sober debate on the issues I have raised here.
