Millers, bakers at loggerheads

HARARE - Millers and bakers are at loggerheads following the expiry of a memorandum of understanding (MoU) signed by both parties, compelling the latter to acquire 75 percent of their flour locally.

While bread is now fairly available, what has largely gone unnoticed are deep-seated “wars” over flour supplies that have strained relations between millers and bakers.

This comes as local wheat production has drastically declined with only 30 000 tonnes harvested last year against a national annual requirement of 400 000 tonnes due to power outages and high costs of production.

According to national statistics, about a decade ago, local producers used to harvest up to 260 000 tonnes from about 65 000 hectares, with the balance of 40 000 tonnes being imported.

In 2012, the hectarage under wheat production shrunk to only 4 000 hectares, with yeild capacity of 33 000 tonnes.

The Grain Millers Association of Zimbabwe (GMAZ), whose members are importing most of the wheat, has asked government to tighten laws on the importation of the commodity.

Tafadzwa Musarara, the association’ president said the country is currently selling $365 million worth of bread annually while 60 percent of that is going towards flour requirements.

This means that about $150 million is being spent on flour imports.

“Out of a total national consumption of 20 000 tonnes a month, we had agreed that only 5 000 tonnes should come in. But now 14 000 tonnes are being imported per month.” he said.

“Bakeries are taking advantage of our loose agreement to import more than we agreed. Maybe,  there is now need to approach government and seek that they legislate the industry to help mitigate a growing trend of marginalisation of black millers in this country and it is bad,” Musarara said.

On the other hand, bakers are lobbying government to allow them to import processed flour which they argue is cheaper and of better quality than the local product.

Givemore Mesoemvura, the National Bakers Association of Zimbabwe’s (NBAZ) president, said while the bread price has remained unchanged at $1 per loaf since dollarisation in 2009, the bakers have been facing escalating operating costs, particularly of locally-sourced raw materials.

He said out of the 257 operational bakers’ installed capacity of two million loaves per day, just above a million were being produced.

“...(baking) industry is struggling financially and technically to make ends meet,” Mesoemvura said at the ‘Buy Zimbabwe’ baking industry stakeholders’ conference held recently, adding that suppliers also had to avail credit terms to bail out the confectioners.

Apart from the costs, this comes as most players in the baking industry have of late been facing challenges such as quality inconsistency in local flour quality, yeast and gristing ratios.

Last week, Innscor — a leader in the baking industry through its Bakers Inn chain — announced that it was scaling down its bakeries’ network due to depressed demand, among other challenges.

Mesoemvura added that there was great need for bakers to retool to reduce inefficiencies and also re-introduce supply depots countrywide.

“We also need consistency in product quality and efficiency of supply of locally sourced inputs,” he said.

The battle between bakers and millers has dashed the hopes of wheat farmers who are struggling to produce the cereal despite a host of challenges that include lack of capital, unreliable power supplies and low prices of their produce which are being influenced by cheap wheat being imported into the country.

To compound matters shops with in-house bakeries are now importing dough, which has seen them cutting down on their flour orders.

A leading agriculture expert Professor Mandivamba Rukuni says there was no way wheat production can be increased without all stakeholders pulling in the same direction.
“The vision of continuing sustained winter wheat production will remain a pipedream  if we don’t address the issue of water, irrigation and funding,” he said.

Rukuni noted that there was need to revive the contract farming model which assists in unlocking capital into agriculture sector.

 

Comments (1)

What a shame! We sent the farmers to places like Zambia and the millers to places like Malawi. We thought we would win elections by insisting Zim-manufactured items should be sold at less than cost. It destroyed the Z$, but South African millers are still thanking us. Zimbabwe should be buying wheat for (say) $500 / MT; instead it is paying (say) $700 for the imported flour. $200 is value addition and jobs that should be going to locals, but instead we have shoved to our neighbours. No wonder they cheer us on, and declare our elections free.

john banda - 17 March 2014

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