IN AN economy where market forces are sensitive and swiftly responsive to any major economic statement and positive occurrence, the prices of mealie-meal could have this week started coming down.
The same way factors like increases in the prices of petroleum products almost immediately trigger changes in the prices of any other commodity in the economy, the announcement of the record-high maize production should trigger cuts in prices of mealie-meal and other maize products.
However, while the local players are quick to respond to any changes which entail increment in the prices of their products, they are reluctant to effect any entailing reduction in the prices of their commodities.
The projected 3.3-million tonne maize production would, in some economies, lead to various economic gains as almost all the sector would respond to the positive report.
Maize being a staple crop, its bumper harvest should spur the improvement in many economic indicators like inflation, foreign exchange rate and generally the growth in the Gross Domestic Product (GDP).
This is, however, mostly dependent on the conduct of the players – starting with the millers and then the mealie-meal traders – in the local economy towards the record-high maize production.
We have had instances where the Government through the Food Reserve Agency (FRA) has offloaded its highly subsidised maize on the market to dampen the prices of the mealie-meal but the prices have remained static.
One should, therefore, not be faulted for thinking that apart from guaranteeing national food security in terms of mealie-meal and other maize products on the market, the bumper harvest will not help much due to the greed of some players in the sector.
According to the forecast, maize production is expected to exceed last year’s production of 2.5 million tonnes by 32.29 per cent. Generally, maize production since pre-independence era has in the short-term been fluctuating, while in the long-term it has been increasing.
According to Index Mundi, an online resource, Zambia Maize Production by year was 515,000 tonnes in 1961 and dropped to 480,000 tonnes in 1963 and to 395,000 by the independence year in 1964.
In 1981, due to various policies by the UNIP government which boosted the agricultural sector, the country recorded the highest production of 1.2 million tonnes.
The years that followed, the harvests drastically reduced until 1985 when 1.1-million tonne production was recorded, while in 1987 another record-high production of 1.94 million was recorded.
Another record in the production of maize was broken in 2010 when 2.8 million tonnes of maize was harvested.
That record was shattered the following year when three million tonnesof maize was produced and this year that has been outdone with the 3.3 million tone production.
While the country has been increasing maize production, it seems not to have done much in the improvement of productivity and addressing the cost of production.
The continued low productivity as the result of the high cost of living and other factors make the Zambian maize uncompetitive on the international market including within the region.
For instance in the 2010 marketing season, the Food Reserve Agency (FRA) set K65,000 per 50 kilogramme bag of maize as the floor price for the commodity, which translated into US$260 per tonne.
The FRA was to later export the same maize acquired at $260 per tonne at about $200 per tonne to some neighbouring countries, thereby making a loss of at least $60 per tonne excluding costs incurred in storage, transportation and others.
At that time the small-scale farmers produced not more than 2.5 tonnes per hectare compared to four to five tonnes per hectare recorded in the region on average.
The potential for maize is as high as eight-10 tonnes per hectare with good management.
Given the price of $260 per tonne offered by the FRA as the local market price versus the regional price of $200 per tonne, the agency was paying higher than what the market was offering for a reason.
This year, Agriculture and Livestock Minister Wylbur Simuusa says, the average yield rate for small and medium-scale maize farmers has increased by 21 per cent.
It has risen from 1.86 tonnes per hectare to 2.26 tonnes per hectare, while the average yield rate for large-scale farmers has gone up by 18 per cent from 4.82 tonnes per hectare to 5.68 tonnes per hectare.
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