Zambia National Farmers Union Concerned Over FRA’s Maize Pricing Strategy

The Zambia National Farmers Union (ZNFU) has expressed its concerns regarding the pricing strategy of the Food Reserve Agency (FRA) for maize, amid ongoing challenges posed by the El Niño-induced drought.

The ZNFU has acknowledged the early entry of the FRA into the crop market, providing farmers with an additional buyer for their produce. However, the Union has raised alarm over the pricing discrepancies between FRA and private buyers, citing potential market competitiveness issues.

According to ZNFU, private buyers are currently offering significantly higher prices for GMO-free maize compared to FRA’s offering of K330 per 50kg bag ($264 per tonne). Moreover, spot prices in neighboring countries for similar maize types range from US$300 to US$570 per tonne, further highlighting the disparity.

Elias M. Banda, Manager of Communication, Media, and Public Relations Services at ZNFU, stated, “As a Union, we feel that FRA has ‘missed a penalty’ on pricing and are unlikely to compete favorably in the market.”

The Union emphasizes the importance of pegging prices to import parity prices (IPP) to incentivize local farmers to sell their maize to FRA, thus preventing potential market destabilization.

Furthermore, concerns have been raised regarding a statement attributed to the Ministry of Agriculture, suggesting that all Farmer Input Support Program (FISP) beneficiaries who fail to supply maize to FRA will be blacklisted. With many farmers grappling with crop failures due to the drought, ZNFU questions the feasibility of such a directive and calls for its immediate rescindment.

Banda underscored, “The statement must be rescinded immediately because innocent farmers will be victimized yet the reasons for crop failure are known by everyone.”

Amidst the challenges posed by the drought, ZNFU appeals to the Ministry of Agriculture for a supportive stance towards farmers, emphasizing the need for comprehensive support mechanisms to ensure food security and sustainable agricultural practices in Zambia.

Below is the Full Press Statement

PRESS STATEMENT ON THE FRA MAIZE PRICE

THE Zambia National Farmers Union (ZNFU) is pleased that the Food Reserve Agency (FRA) has entered the crop market early, unlike most seasons in the past when moisture content caused them to enter the market late.This provides the farmers with an alternative buyer for their maize.

As a nation, everyone is aware that a national disaster was declared by President Hakainde Hichilema because of the drought caused by El Nino which affected most parts of the country. This has threatened Zambia’s food security.The FRA recently announced that they will be buying white Non GMO maize at K330 per 50kg ($264 per tonne). FRA has since invited farmers with white GMO-free maize to deliver this maize to their nearest FRA depot.

ZNFU is aware that private buyers in the districts are currently buying GMO-free maize above K350-K400 per 50 Kg bag. Further the spot price in neigbouring countries for non-GMO maize is in the range of US$ 300 to US$570 per tonne,compared to the $264 being offered by FRA.

As a Union therefore, we feel that that FRA has “missed a penalty” on pricing and are unlikely to compete favourably in the market.The 2023/2024 farming season is not a normal farming season in terms of production because it is lean. Farmers who have experienced shortages in their harvest will be seeking to recoup their losses by selling to the highest bidder. Hence
competition in commodity markets will be stiff as already evidenced by the prevailing producer prices At this point, our humble advice to FRA is that they should peg their price to the import parity price (IPP) to give local farmers an incentive to sell their maize to FRA and prevent possible “maize flight” to attractive markets.

ZNFU is aware that the nation needs this maize to replenish our national strategic food reserves hence there should be no room for risky pricing attempts in the hope of revising them later because the maize will not be there.

Further, farmers are concerned by a statement attributed to the Ministry of Agriculture stating that all FISP beneficiaries who wont supply maize to FRA will be blacklisted. This statement coming at a time when most of the farmers do not have any maize because of the drought. Where will farmers on FISP get the maize to supply FRA?

The statement must be rescinded immediately because innocent farmers will be victimized yet the reasons for crop failure are known by everyone. The Head of State declared the drought as a national disaster, a situation which requires all support
mechanisms to be triggered first to make sure no one starves including farmers faced with crop failure. Secondly to all farmers, whether on FISP or not need Government support to re-start so that they can still plant next season. Let us
remember that some FISP farmers may not even be able to raise their contribution towards FISP and non FISP farmers will take many seasons before recovering.There is nothing positive that will be achieved by this threatening statement apart
from victimisation of innocent farmers. We appeal to the Ministry of Agriculture to cease fire!

Issued by:

Elias M. Banda
Manager – Communication, Media and Public Relations Services
Zambia National Farmers Union (ZNFU)