Sunday, 31 May 2020


A shortage of subsided mealie-meal is looming as it has emerged that the Grain Marketing Board (GMB) has not supplied maize to millers under the subsidy programme since the beginning of May.

In addition, millers are also complaining that the Government has not paid them the subsidy under the maize subsidy programme since February, a situation that is now threatening most companies. GMB general-manager Mr Rockie Mutenha confirmed that the parastatal stopped supplying millers with maize after the Government announced a new producer price of grain. In April, the Government announced that the new producer price for maize was now pegged at $12 329 per tonne up from $6 958.

“We stopped for the month of May when a new producer price was announced. The millers themselves didn’t know what price to sell the mealie-meal at because the subsidy was being worked on by the Ministry of Industry and Commerce,” he said.

Grain millers are also calling on the Government to expedite payment of previous allocations to enable them to keep their operations afloat while ensuring the availability of food. 

In a letter dated 27 May and addressed to the Minister of Finance and Economic Development, Professor Mthuli Ncube, to express their concern on how the suspension of import duty on flour and maize-meal under the Statutory Instrument (S.I) 119 of 2020 would affect their business, Small to Medium Millers Association of Zimbabwe (SMMAZ) also noted that Government was still to pay most of the Small to Medium Enterprises (SMEs) millers under the maize subsidy programme since February.

“We would also want to draw your attention to the fact that most SME millers, whose interest we represent, have had outstanding subsidy payments due to them by Government being eroded by inflation, with some payments currently still outstanding since February this year.

SME millers have lost up to 60 percent of their working capital. This is the sacrifice that your local SME millers have made to ensure support for the Government’s subsidy programme,” read part of the letter.

A source privy to the on-goings in the milling industry confirmed the non-payment of millers, further stating that the price of the subsidised maize has gone up folds from $4 000 to $12 000 per tonne from the time the millers last received their payments. 

“Maize has increased three fold since February and can you imagine the plight of a miller whose money has been held by the Ministry of Finance (and Economic Development) from that time. We are patriots that have supported this subsidy programme but we need Government to appreciate that millers are the biggest casualties in this programme. If we close our plants people will lose out,” said the source.

The maize roller meal subsidy programme was designed in such a way that the GMB allocates maize to licensed millers at a subsidised price. Millers are in turn required to distribute to retailers who will then sell mealie-meal to ultimate consumers at a price which is 50 percent of the market price.

The gazetted price at which millers sell to retailers is currently $63,64 per 10kg and retailers are required to sell the same packet at a maximum price of $70. The Government would then pay licensed millers subsidy amounts commensurate to an agreed extraction rate of 80 percent after verification that production has taken place. Maize purchased by licensed millers from the GMB should be used solely for the production of mealie-meal.

“We are appealing to the President to intervene and help the milling sector before it collapses. What we are really asking for is for the millers to be paid what is owed to them in grain credits equivalent to the price of maize, when they did the milling because the relationship should be in two ways, millers can give but Government should also give, it should be a give and take scenario and there should be a bit of balance and equilibrium in saving the interest of the nation and keeping the industry alive,” said the source.

Efforts to get a comment from Finance and Economic Development permanent secretary Mr George Guvamatanga were futile as he had not yet responded to questions sent to him by the time of going to Press. SMMAZ chairman Mr Davis Muhambi confirmed the development and called on Government to expedite the allocations as it was adversely affecting SME millers’ operations.

“We continue to plead with Government to expedite the resumption of allocations. Our SME millers’ businesses are under immense strain at the moment and face imminent collapse,” he said. Sunday News


Post a comment