Business

Stock feed production to double

STOCK FEED PRODUCTION TO DOUBLE
Harare March 21, 2012 (New Ziana) -Production of stock feeds in Zimbabwe is set to double this year from 350 000 tonnes last year buoyed by a rise in livestock production.
Livestock sectors such as poultry and piggery have grown significantly since the adoption of multiple foreign currencies as costs have dropped allowing more players to venture into the business.
The commercial pig herd currently stands at 12 000 representing a 50 percent increase from the 2008 figures while  day old chicks production is set to  rise to 70 million this year, a 40   percent  increase from last year.
Installed capacity for local stock feed manufacturers stands between 600 000 metric tonnes and almost 1 million tonnes per annum although only between 30 and 40 percent is being utilized. 
Stockfeeds Manufacturers Association (SMA) chairman Fungai Mungate said the industry had the capacity to double production this year.
“We will certainly double production of stock feeds this year since there is a surge in demand as more farmers are taking livestock production in the country seriously as a business venture.
“In addition, most of our members now can afford retooling. Some have refurbished their plants and others have actually installed new ones all together,” he said.
The SMA has 37 members accross the country.
Mungate said growth of the agriculture sector in general also drove the rise in manufacturing of stock feeds.
“We continue to urge the government to channel more resources towards crop and animal production in the country as it has an impact on the manufacturing industry,” he said.
“High yields of maize and soya beans guarantees raw materials for us while increase in live stock production will push up the demand of stockfeeds.”
He said the association was importing 75 percent of its raw materials.
“Amongst the raw materials we require only cotton seed is readily available. The rest are being imported from neighboring countries,” he said, adding maize was being imported from Zambia and soya bean from India.
The Stock feed Manufactures Association of Zimbabwe has been in existence since the 1990s, went into hibernation during much of the economic downturn in the country before being resuscitated in May 2007.
New Ziana

Zim still to avail own portion to assist companies

TREASURY YET TO AVAIL DIMAF CONTRIBUTION
Harare March 20, 2012 (New Ziana)-The Zimbabwe government is yet to avail its US$ 20 million contribution to the Distressed Industries and Marginalized Areas Fund (DIMAF) that it launched in partnership with Old Mutual to revive ailing industries in Bulawayo.
The US$40 million fund was launched last year and is being disbursed through CABS.
Industry and Commerce permanent secretary Abigail Shonhiwa told the Parliamentary Portfolio Committee on Industry and Commerce that the government was yet to avail its half.
“As of early March our partners had put in their half but as government we had not yet put in ours,” she said.
“I am aware that Treasury is busy making efforts to raise the money.”
Shonhiwa said many companies were failing to access the money due to the stringent requirements to qualify for the loans.
She said her Ministry had engaged CABS with a view of relaxing some of the conditions
“The conditions for accessing the facility should be reviewed and the bar should be lowered because we are dealing with companies under distress.
“There should also be a clear understanding between the partners so that the objective of setting up the fund is met and there is need to beef up this fund,” said Shonhiwa.
Director for Enterprise Development in the ministry Stanislaus Mangoma said many companies were failing to meet the criteria for accessing the loan facility.
He said most of the applications were still pending adding that to date only US$3, 1 million had been disbursed.
“There has been some preliminary contact with CABS. They have shown some flexibility in terms of interest rates and collateral for SMEs but for those listed on the stock exchange those old terms will apply,” he said.
A number of industries are operating below capacity as funding needed to retool and recapitalize has proved to be elusive and expensive.
Most Bulawayo companies have relocated to Harare and other cities as conditions for operating in the once industrial hub continue to deteriorate.
It is estimated that at least US$2 billion in fresh capital is required to recapitalize industries in Zimbabwe.
In addition to DIMAF the government has launched other funds like the US$70 million Zimbabwe Economic Trade Revival Facility (ZETREF) for local industries to access.
New Ziana

International cotton prices set to decline

INTERNATIONAL COTTON PRICES SET TO DECLINE
Victoria Falls March16, 2012 (New Ziana) -Global economic conditions are not able to sustain the high prices of cotton that obtained in the past marketing season, an international cotton trade expert said on Friday.
Cotton Outlook director Michael Edwards told the ongoing 10th Africa Cotton Association Congress that it was highly unlikely that the commodity would this year fetch the all time high of US$2, 40 per pound earned in the previous selling season.
The surge in prices in the 2010/11 season saw local farmers pocketing an average of US$0, 84 kilogram at the start of selling with prices falling as it progressed.
“We will not see runaway prices as in 2010/11. Over supply is not due to high yields but reduced consumption as cotton now competes with other synthetic fibers,” he said.
The Cotton Outlook is a United Kingdom weekly publication that gives an in- depth review of the crop and market developments around the world.
Edwards said China had 2, 3 million tonnes of cotton in stock which it could utilize or channel back onto the market.
He said cotton prices were likely to firm at around US$1 dollar per pound.
“Historically US$1 per pound is higher than the up and down of 2010/11 marketing season since in the past US$0, 70 has been the average price globally,” he said.
Global cotton production dipped in the 2009/10 season due to floods in Pakistan, one of the world’s largest producers of the white gold, ban of cotton exports by India and heat waves as well as droughts in some cotton producing nations.
It is estimated that close to 36 million hectares have been put under cotton globally in the current cropping season.
Zimbabwe’s cotton output is expected to rise to between 265 000 metric tonnes and 280 000 this year up from 249 000 last year.
Last year cotton growers in the country earned a total of US$200 million.
New Ziana

Govt mulls legislating to lower interest rates

GVT MULLS LEGISLATING TO LOWER INTEREST RATES
Harare March 15, 2012 (New Ziana)-The government is considering introducing legislation that compels local financial institutions to lower the high interest rates they are currently charging, a senior government official said on Thursday.
Banks in Zimbabwe are charging interest rates as high as 40 percent per annum on loans while a few are extending credit facilities going beyond one year.
This has been largely attributed to the short term nature of most deposits in banks.
Ministry of Finance permanent secretary Willard Manungo told the Parliamentary Portfolio Committee on Small and Medium Enterprises that they were mooting introducing the law following a public outcry over the punitive rates. 
“It is a matter that is still being debated on whether we need to legislate the disparity between the lending rates and interest rates being charged,” he said.
“The other option would be to persuade the banks to lower the rates.”
Manungo noted that countries like Kenya had introduced similar legislation to lower interest rates.
He said Micro Finance Institutions (MFI) were also charging high interest rates of up to 30 percent per month that were burdening borrowers.
He said as a result the government was crafting a Micro Finance Bill to curb the problem that was mainly affecting civil servants and small and medium enterprises (SMEs).
“We have civil servants perpetually living in debt because they cannot repay the loans a situation which is not acceptable.
“We need to come up with tighter legislation for the lending rates not only for the MFIs but for those institutions that take deposits as well,” he said.
With the economy on a gradual mend an increase in total bank deposits has been noted rising to about US$3, 45 billion last month but the resultant increase in liquidity has not been enough to satisfy the need for funding by the productive sectors of the economy.
With reports that revenue inflows during the first three months of 2012 remained constrained as the anticipated proceeds from diamond sales did not materialize interest rates are likely to remain high.
But analysts however contend that the repatriation of nostro account balances and proceeds from tobacco sales will ease the liquidity crisis thereby assisting in stabilizing the prevailing interest rates.
New Ziana

zia TARGETS us$10 billion FDI

ZIA TARGETS TO ATTRACT US$10 BILLION INVESTMENT
Harare March 14, 2012 (New Ziana) -The Zimbabwe Investment Authority is targeting to secure US$10 billion in foreign direct investment (FDI) this year, up from US$6. 6 billion last year, an official said on Wednesday.
ZIA chief executive officer Richard Mbaiwa said mining and manufacturing sectors were expected to attract the bulk of the investment.
“We are targeting to approve projects worth US$10 billion this year as well as to reach 50 percent investment approval per annum.
“By 2015 we aim to have FDI contributing 25 percent of the country’s Gross Domestic Product,” he said.
Mbaiwa said the authority would attract investment through road shows and conferences in and outside the country.
Z IA was formed in 2010 аѕ a One Stοр Shop with one of its major mandates being to reduce investment approval time five days from the previous ninety which observers was driving away investors.
In Mauritius it takes less than one day to approve an investment.
So far this year ZIA has approved projects worth US$28 million, down from US$33 million during the corresponding period last year.
Last year the authority approved projects worth US$6.6 billion with potential to create 26 000 jobs, up from US520 million and potential to make 7 000 jobs in 2010.
The mining sector received more than half of the investment chunk followed by tourism, manufacturing and the service industry.
Brazil, India, China and South Africa contributed much of the investment.
Last year’s increase was attributed to increased investor confidence as well as the stable macro economic environment which the inclusive government ushered in.
New Ziana

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