Millers hail Chinamasa

HARARE - The Grain Millers Association of Zimbabwe (Gmaz) has hailed Finance minister Patrick Chinamasa’s move to remove wheat flour from the Open General Import Licence (OGIL), saying it will help local companies grow.

In a statement released on Friday, Gmaz chairperson, Tafadzwa Musarara, said the development was going to stop the importation of wheat flour, which had rendered local players uncompetitive.

“Bakers who had already resorted to using 100 percent local wheat, notably Bakers Inn and Proton, have been able to obtain more than adequate local flour, produce high quality bread on the market at the same price with those bakers who had been importing flour,” Musarara said.

This comes as the number of local millers continue to shrink despite support measures availed by government to the sector, with the number having decreases from 368 in 2007 to 37 in 2016 on the back of competition from wheat flour imported from the region under bilateral trade arrangements.

The apex grain milling industry representative body also expects wheat contract support hactarage to grow in 2017, buoyed by the removal of what flour from the OGIL.

“Further, we welcome the proposed amendment on the preferential treatment granted to flour milled from countries that do not grow wheat but have a subsisting bilateral trade agreement with Zimbabwe.

“This will discourage wheat flour imports and save the local flour milling industry,” said Musarara.

Despite threats to the viability of the milling industry, the sector continues to receive new investment.

Blue Ribbon Foods has been revived by a new investor, which has increased the level of capacity utilisation and competition, resulting in prices of flour declining from $32 to $27 per 50 kg.

“Such investments need to be nurtured, in order to enhance value addition and linkages with the agro-processing and packaging industry.

“It is, thus, proposed to amend bilateral rules of origin on flour, to the effect that the preferential treatment is granted to flour milled from wheat grown in the country of export.

“It is, further, proposed that wheat flour be removed from the Open General Import Licence. The measures take effect from January 1, 2017,” Chinamasa said in his 2017 Budget presentation on Thursday.

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