Oliver Kazunga Senior Business Reporter
The Small-to-Medium Millers’ Association of Zimbabwe (SMMAZ) is appealing to Government for continuity of grain allocation to players in the sector in order to improve supply of mealie in the formal market.
At present, the formal market is characterised by mealie meal shortage, which small-to-medium scale millers believe, the situation could improve if grain allocation is consistently supplied to the milling industry.
Responding to questions during a Press conference in Bulawayo soon after their first board meeting last Friday, the interim chairman of the recently launched small-to-medium millers’ association Mr Davis Muhambi said: “These grain allocations are monthly, but what we realised is that at the end of the month, we have to wait for new allocations and that is then adding to the shortages that are already there.
“So, it makes the situation of shortages to become more amplified so we are trying to engage Government that there should be continuity in the allocation of grain and the bringing in or imports of grain.”
He said his association was proposing to Government to credit their members’ grain accounts with Grain Marketing Board so that the millers would draw down grain pointing out that this would add impetus on the allocation of grain while reducing shortages of mealie meal in the market.
“We’ve resolved as board of SMMAZ that we should step up the Government to bring it to their attention that if allocations do not come consistently, then we have shortages that come at the beginning of the month, that then would mean that there is going to be speculation because people know that at the end of the month there is going to be a shortage.
“What is going to happen is people who are going to buy the mealie who are the retailers, at the end of the month they will go and lock it up into their warehouses and wait for shortages to kick-in every month,” said Mr Muhambi.
Zimbabwe’s grain shortage has largely been exacerbated by the drought that hit the country last year.
The country whose national grain requirement stands a 1,8 million tonnes annually has seen Zimbabwe importing grain in the region from countries such as South Africa as well as internationally as far as Brazil, Venezuela and Russia.
As part of measures to cover the deficit, the Government in October last year gave the greenlight to individuals and corporates with free funds to import any quantities of grain into the country to complement Treasury efforts in ensuring adequate food reserves.
In addition, the Government last December, also launched the subsidised roller meal programme with a view to improving supply of mealie meal in the formal market.
“The roller meal subsidy programme currently has got its challenges and this has formed part of our board meeting agenda today (Friday). In the main the programme can work, its not working as it’s supposed to be,” he said.
Under the subsidy programme, roller meal is paid by Government directly to millers on proof that they have milled and delivered the meal to the market.
“There is also the issue of payments . . . as we do our working cycles, it means we are consistently running out of our working capital which allows us to procure the grain.
“If Government payments are coming late as they are right now it means especially small-to-medium millers, they are then disenfranchised,” said Mr Muhambi.
Asked about allegations that some millers were involved in uncouth practices channelling mealie meal to the black market, he said they were not aware of any of their members diverting mealie meal to the black market.
“We have recommended our members to only sell mealie to registered retailers that meet certain criteria like a shop licence, tax compliance and they should fill in registration with the miller so that there is KYC (Know Your Customer).
“We are not aware of the millers who are actually taking the mealie meal into the black market as small-to-medium millers we are not aware of that.
“But we set up also a committee that looks into the issue of corruption and we are putting message out to our members to inform the committee of any such happenings so that we help the Government to do away with these issues but we are not aware of millers.
“However, we are aware that they are retailers who probably then take the product into the black market for better profits.”
He said if the millers divert mealie into the parallel market, there was a bigger risk on the millers’ part because they then tend to lose the allocations of grain which is the basis of their survival.
“There is too much risk involved in a miller taking the product to the black market and then being banned as opposed to a retailer.
“This is also the reason we think that the engagement we shall have with Government, we need to rope in retailers because we don’t think it’s a problem emanating from the millers but somewhere along the distribution chain primarily with retailers and wholesalers,” said Mr Muhambi.