HomeBusinessGovt moves to rescue GMB

Govt moves to rescue GMB

GOVERNMENT is aiming to raise US$50 million through Agriculture Marketing Authority (AMA) bills to liquidate the millions of dollars owed to farmers for grain deliveries, Finance Minister Patrick Chinamasa has said.

by our staff

In a statement Chinamasa said to date government had disbursed US$57,6 million to the Grain Marketing Board (GMB) for payment to farmers including US$8,2 million for grain delivered during the previous season.

“Government, in collaboration with AMA and CBZ has issued another lot of AMA bills targeting mobilisation of US$50 million.

However, these resources will not come at once but over time. Already, against this issuance, US$3 million has been raised towards liquidation of the outstanding amount to farmers.

“Therefore, as additional resources become available, they will be channelled towards payment of the outstanding amount to farmers in order to capacitate them to invest towards the 2014/2015 agriculture season,” Chinamasa said.

He said the government outstanding obligation to farmers for grain deliveries now stood at US$52,4 million.

He however said as of December 2014, grain deliveries by farmers to the GMB under the 2014/2015 grain marketing season amounted to 255 519 tonnes valued at US$101,8 million.

“Given the objective of ensuring food security, government remains a key player in the purchasing and storage of grain through the GMB. As such, government prioritises the payment to farmers for grain deliveries made to GMB,” Chinamasa said.

“While it is ideal that farmers get their payment timeously for their various needs including farming operations, the prevailing liquidity challenges have resulted in government falling behind in payments.”

He said of the US$57,6 million paid by government, US$51,5 million was raised through the issuance of Agriculture Marketing Authority (AMA) bills with the balance being paid from fiscal resources.

In his 2015 national budget, Chinamasa said prospects for the 2014/2015 agriculture season remained positive, and production in the main crops — maize, tobacco, and cotton, among others were expected to remain on an upward trend. Overall agricultural growth for 2015 was projected at 3,4%.

He said in terms of grain procurement, deliveries to the GMB for the current marketing season now stood at 239 042 tons valued at US$93,2 million, well within the projected target of 250 000 metric tons for the season.

The overall support under the Strategic Grain Reserve now stands at US$81,9 million, with a sum of US$51,5 million having been mobilised from the market through issuance of AMA bills.

Of this amount, as at November 13 2014, US$57,6 million had been paid to farmers for grain deliveries, US$22 million for handling and storage charges, whilst US$2 million was for payment for grain importation charges from last year.

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