GMAZ seals wheat payments deal

Source: GMAZ seals wheat payments deal | The Herald 02 SEP, 2019

GMAZ seals wheat payments dealMr Musarara

Enacy Mapakame Business Reporter
The Grain Millers Association of Zimbabwe (GMAZ) has sealed a payment deal with a Swiss-based firm, Goldstone & Co, to enable it to import wheat in a development that guarantees consistent supply of the grain.

The latest development also dispels lingering fears over potential shortage of flour and consequently bread ahead of the festive season and going forward.

Zimbabwe has been experiencing wheat supply gaps due to shortage of foreign currency needed to import the grain.

Resultantly, flour and bread shortages became inevitable and prevalent, which pushed up prices.

But, under the agreement, Goldstone will ensure constant supplies by making the payments to suppliers.

Government will then settle the bill with Goldstone, although the finer details of the terms and conditions could not be immediately established.

Already, the first consignment amounting to 5 000 tonnes has been received. This is part of the 30 000 tonnes Goldstone has already paid for this month with the remaining 25 000 tonnes expected in the country this week.

GMAZ chairman Tafadzwa Musarara said this arrangement was a step in the right direction as it will ensure the country has guaranteed wheat supplies and as such enough bread supplies especially when approaching festive season where demand for bread and other confectioneries spike. Zimbabweans consume about 1,5 million loaves of bread a day.

“The consumption of bread and other wheat flour products is expected to increase in the next four months and with the plans we have put in place we are confident we will be wheat secure for the rest of the year.

“The country will not experience any bread shortages,” said Mr Musarara on Friday at the Blue Ribbon complex in Harare where part of the first consignment was delivered.

“We also want to thank the Government and the President for their efforts towards normalising the wheat supplies in the country. Now the milling industry is fully geared for the festive season where demand spikes,” he said.

According to the GMAZ, demand for wheat from September 1 to end of the year is expected to be 110 000 tonnes. The bulk of this wheat will be imports.

The wheat consignments coming in the country under the agreement with Goldstone will benefit the top five flour milling companies in the country.

Additionally, wheat stocks that had been held up in Beira due to non-payment will be released into the country, which will further improve the supplies.

“As at this morning (Friday), the wheat that had spent months at Beira in excess of 20 000 tonnes, is now coming into Zimbabwe with the help of the RBZ and this will make us wheat secure.

“What this means is when we pay for wheat, say in the morning, by afternoon we should get it, which is the normal situation in many countries to have stocks readily available in warehouses within the country,” he said.

Goldstone & Co representative Anthony Denga said his company was prepared to extend the same financing structure to maize as part of efforts to ensure the country has adequate grain and food secure.

“We are trying to assist where we can, right now we have an agreement with GMAZ for 120 000 tonnes and if they are happy with the structure we will continue and extend it to maize as well.

“We are facilitating payment for wheat and then we will be paid by the RBZ and Ministry of Finance to ensure grain is sitting in the country and there are no shortages,”

Blue Ribbon general manager Yusuf Kumau said: “We are happy with the arrangements we have in place with GMAZ to receive this important grain.

“We also want to assure the nation that bread will be available as we continue milling.”

The country needs at least 400 000 tonnes of wheat per year to meet its demand.

On a monthly basis, wheat consumption is estimated at 38 000 tonnes for the production of bread, confectioneries, biscuits and other flour-related products. The country now relies on wheat imports as current production cannot meet demand.

Zimbabwe’s wheat production experienced a sharp decline when output halved to 150 000 tonnes before further declining to about 38 000 tonnes during the hyperinflation period of 2008/9.