Raw materials shortage hits oilseed processors

Tinashe Makichi Business Reporter
Oilseed processors in Zimbabwe have been hit by raw material shortages following poor yields in cotton and soyabeans recorded in the previous farming season.

According to officials in the industry about 60 000 tonnes of raw materials were produced during the previous season against the processors’ annual requirement of around 500 000 tonnes.

Zimbabwe Oil Expressers Association president Sylvester Mangani last week said oil processors were currently importing crude oil as seed crushers were currently offline.

“The country consumes about 10 000 tonnes of oil per month and a tonne of seed gives you 20 percent of oil. This therefore means that if you are going to make up the 100 000 tonnes of oil required by the country then we need about 500 000 tonnes of seed as national demand.

“But the country only produced 60 000 tonnes and that was last year’s season,” said Mr Mangani.

In the 2014 /15 season, cotton production declined to its lowest level in three seasons due to reduced inputs support to farmers in a sector riddled by rampant side marketing. Output fell seven percent to 135 000 tonnes from 145 000 tonnes in the proceeding season. Besides low input support, production was negatively affected by changes in the rainfall patterns while many farmers also shifted from cotton to tobacco.

“I can confirm that our crushers at Surface are not working at the moment due to the raw materials issue. It’s also the same story at Olivine . . . most cooking oil manufacturers are importing crude oil,” said Mr Mangani.

During a tour of Surface Wilmar’s facilities last week, The Herald Business saw huge container trucks ferrying crude oil to the plant from different source markets.

Zimbabwe’s major oil seed processors in Zimbabwe are Bulawayo-based United Refineries Limited, Olivine Industries, Surface Wilmar and Export Trading Group.

“We are now looking at programmes to rebuild the agro sector, particularly the primary sector; iron out contract farming and extension service issues to ensure we have adequate stocks for local companies, say in the next five to seven years,” said Mr Moyo, who is also United Refineries chief executive.

Mr Moyo said Government should speed up the process of issuing import permits to oilseed processors to avoid disrupting production.

He said permits should be based on capacity and flexible to allow companies to import from any dealer.

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