GMB to buy wheat using last year's producer price: Govt

 Zimbabwe government has given the Grain Marketing Board authority to buy wheat using last year's producer price of US$466 per tonne.

Farmers were anticipating an increase in the wheat producer price, with some withholding their crop in anticipation of the announcement.

Agriculture, Mechanisation and Irrigation Development Minister Joseph Made on Tuesday said GMB was not going to increase the producer price.

"It is true that we have to strike a balance between the cost of production and the producer price, but there is no way Government will continue increasing producer prices," he said.

Minister Made said the only option for farmers was to increase yields per hectare, so that they realise meaningful profits.

"While I sympathise with farmers, they should not always anticipate prices to go up.

"On the other side, consumers can not continue to pay high prices," he said.

Minister Made said Government was looking at subsiding inputs not prices.

"The wheat matter stands resolved and it is Government's directive," he said.

GMB had received 13 500 tonnes from farmers as of November 2011.

About 30 000 tonnes are expected from the 2011 winter wheat season.

The Grain Millers Association of Zimbabwe said it is making frantic efforts to buy all the wheat grown locally in the 2011 winter wheat season.

GMAZ national chairman Mr Tafadzwa Musarara said the association was aware that many farmers were holding on to wheat since GMB did not have ready cash to pay them.

"The millers are also battling with liquidity challenges that are affecting the economy," he said.

The milling industry has been buying local wheat from the farmers they contracted under the Zimbabwe Commercial Farmers Union and Zimbabwe Farmers Union.

There are efforts to buy the wheat grown outside these two contracts.

Mr Musarara said they would pay for the wheat through prior arrangements with any respective miller of the buyer's choice.

The registered GMAZ wheat millers are Victoria Foods, Blue Ribbons Industries, National Foods, Manyame Milling and Muga Foods.

"We are fully aware that farmers are facing serious problems in storing the wheat properly and run the risk of contami- nation and weevils attack," said Mr Musa-rara.

"The GMAZ is in discussion with other stakeholders so that we buy all the locally grown wheat as soon as possible and save the farmers."

Mr Musarara said most companies were offering a minimum price of US$430 per tonne.

Private buyers take advantage of the situation that GMB is unable to pay farmers instantly to reap off farmers.

Mr Musarara said some unscrupulous business people were offering unviable prices to farmers as they were paying cash.

"GMAZ has learnt that there are some foreign millers from Pakistani buying local wheat at a low price of US$380 per tonne," he said.

"Such transactions prejudice the farmers and are an affront to the agrarian reform."

Wheat production has been on the decrease for the past few years due to erratic electricity supply while some farmers have turned to burley, which is produced under contract.

Most financiers are reluctant to support wheat production because of the high risks associated with the crop.