Govt considers pre-selling wheat to pay farmers

by Grace Chekai

Treasury is considering pre-selling wheat to millers to pay farmers an amount in the region of ZW $10 billion, a move that can assist them prepare for the 2020/21 farming season which is expected to produce a bumper harvest due to the normal and above normal rainfall predicted by the Meteorologists in the SADC region.

A contact who works at the Grain Marketing Board (GMB) said, "Treasury is considering pre-selling wheat to millers in order to raise funds to pay farmers ahead of the preparation of the 2020/21 farming season.

"As at 18 October 2020, farmers had delivered 53 121 metric tonnes (MT) of wheat worth ZW$ 2 654 995 176."

Contact said the GMB requires ZW$200 million a day to pay farmers.

She further said that the ZW$10 billion will be paid in four phases so as to avoid destabilising the exchange rate.

"The funds to be paid to farmers shall be injected in phases and Treasury proposed to pay about ZW $2.5 billion per month over four months," said the contact.

Contact revealed that Treasury was considering pre-selling 8 000 MT to millers at the import parity price of US$400 per MT which could raise about US $2.6 billion.