Cotton deliveries jump 39 percent

22 Oct, 2021 - 00:10 0 Views
Cotton deliveries jump 39 percent Cottco says cotton deliveries for the period to September 2021 have surpassed the total tonnage received last year

The Herald

Oliver Kazunga Senior Business Reporter

ZIMBABWE’S cotton deliveries have increased by 39 percent to 114 656 tonnes so far this year from last year’s total output of 82 479 tonnes while a huge portion of the Government’s outstanding payments to farmers, in the form of a subsidy, has since been cleared.

In a trading update for the quarter ended September 30, 2021, the State-owned Cotton Company of Zimbabwe said although deliveries had grown significantly compared to last year, the firm lost two percent of its market share due to side marketing of the “white gold”.

“As the cotton-buying season draws to a close, Cottco’s 2021 intake stands at 114,656 metric tonnes against last year’s full year output of 82 479 tonnes,” said the company. “National seed cotton production is estimated to be 130 000 tonnes, meaning Cottco’s market share is approximately 88 percent.

“Prevalent side-marketing during the season, which was further exacerbated by the shortage of wool packs, resulted in Cottco’s market share declining by two percent.”

Authorities have expressed commitment to putting an end to side-marketing as reflected by the promulgation of Statutory Instrument 97 of 2021 and an increase in court convictions of perpetrators, said Cottco.

On outstanding payments of $1,5 billion for last year’s deliveries, the company said: “A significant portion of the outstanding farmer payments for 2020 have been cleared, with the final payments, of farmers who had not initially submitted banking details, expected to be cleared timeously.

“Cottco expects funding of the 2021 subsidy of $22 per kilogramme to be released any time soon as farmers head back to the fields.”

On financial performance, Cottco said it was publishing the quarterly trading updates pending the imminent finalisation of the outstanding external audits.

Meanwhile, Cottco said investigations regarding a fire incident that occurred at one of its ginnery sites in Checheche, Chipinge South were still underway.

“On the 4th of October 2021 a fire broke out at a site where some of our cotton is toll-ginned in Checheche in Chipinge South resulting in US$2,5 million worth of lint being destroyed,” it said.

“The tonnage lost was insured and physical security at all sites has been increased whilst investigations of the cause of the fire are ongoing.”

On the outlook, experts are predicting an average to above average rainfall pattern in most cotton growing areas in the 2021/2022 agricultural season.

Farmers have already commenced land preparation with a significant number of them expected to adopt precision agriculture under the Cotton Pfumvudza/Intwasa programme.

“This approach promotes focusing on provision of adequate plant nutrition and thus the farmers are expected to achieve higher yields,” said Cottco.

“This is expected to result in further growth in cotton volumes and also result in improvement in returns for both Cottco and the farmers in the upcoming season.”

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