CSC revival awaits Cabinet scrutiny

via CSC revival awaits Cabinet scrutiny | The Herald March 23, 2015

PLANS to revive the Cold Storage Company still await Cabinet approval as the firm looks to explore new beef export markets once it is back on its feet. Agriculture Deputy Minister Responsible for Livestock Production Mr Paddy Zhanda said the proposal for the revival of CSC was still to be approved by Cabinet.

“We have submitted our proposal to Cabinet and it’s still under consideration. I cannot comment on the plans as I would pre-empt it,” he said.

Earlier, the deputy minister said Government was scouting for investors to bail out CSC, adding that discussions with the suitors were on-going to operationalise its defunct CSC depots in Masvingo, Kadoma, Marondera and Chinhoyi.

The CSC has only one functional branch in Bulawayo.

The deputy minister is, however, on record saying he did not think it was necessary to have an investor.

In the past, the deputy minister has condemned private abattoirs for slaughtering cattle charging exorbitant amounts per animal “yet they were doing little work”.

He said this was why Zimbabwe needed to have the CSC fully operational as it was a catalyst in the livestock sector, which can put private abattoirs into line.

CSC suffered a major setback when the European Union suspended beef exports from Zimbabwe in 2001 following an outbreak of foot-and-mouth disease.

It had an annual quota of beef exports to the EU of 9 100 tonnes.

It also had a $15 million revolving payment facility with the EU, under which it was paid in advance.

The company used to earn Zimbabwe at least $45m per year.

However, Deputy Minister Zhanda said the facility under which Zimbabwe had a beef export quota to the EU was under the Lome Agreement, which had expired.

As such, he said that Zimbabwe did not necessarily need to export to the EU, but that there were other potential lucrative markets.

But prior to that, the deputy minister said, the country needed to put its act together. This included production capacity and other key procedural issues.

CSC used to play a leading role in the processing and marketing of Zimbabwe’s beef since its inception in 1937.

The company, however, fell on hard times from 2000 owing to a myriad of challenges among them inadequate working capital, cattle diseases, decline in the commercial herd, huge foreign debt, high staff turnover and an old transport fleet.

CSC last exported beef in 2007.

The parastatal reportedly owes $22 million to various creditors and has a salary backlog of $2,1 million.

It is operating at 7 percent capacity utilisation and has a skeletal workforce of about 500 workers compared to 1 500 in 1999.