Zimbabwe: Bread Shortages Set to Increase As Wheat Stocks Become “Depleted”

Text of report by Zimbabwean newspaper Financial Gazette website on 5 June

[Report by Shame Makoshori: "Bread shortages set to worsen"]

Shortage of bread and other confectionery products are expected to intensify this week amid reports that the country’s wheat stocks have been depleted.

Sources in the industry said wheat stocks had run out, with the country holding about 1 000 tonnes in transit to the state granary.

Deliveries were expected from Mozambique and South Africa but these were not enough to meet weekly wheat consumption levels of 7 500 tonnes.

The country is expected to receive wheat deliveries amounting to 1 500 tonnes from Mozambique and an additional 3 500 tonnes from South Africa. An industry player said even if additional wheat was to be paid for this week, it would take between three and four weeks to land in the country and for bread to start being available on the market.

“This means that elections are going to be held in an environment of serious food shortages, which will result in even higher inflation induced by shortages,” said David Govere, vice president of the Employers Confederation of Zimbabwe.

Zimbabwe is grappling with acute food shortages that have forced government to resort to imports to avert starvation. The imports have had the effect of crowding out the private sector from accessing foreign currency, which is scarce on the domestic market, resulting in intense competition that has resulted in a drubbing of the domestic currency on both the official and parallel foreign currency markets.

Govere said some estimates were giving a residual 20,000 tonnes of wheat on the farms, which could not be delivered because of the low price of 42bn Zimbabwean dollars per tonne paid to farmers by the Grain Marketing Board.

Internationally wheat is selling at about 50 US dollars per tonne, and if Zimbabwean farmers were offered 100 US dollars per tonne, this would translate to 100bn US dollars per tonne based on the inter-bank exchange rate.

Govere, who confirmed the bread making industry was in the lurch due to wheat shortages, said: “In the short term government needs to raise enough foreign currency to secure the wheat and move it speedily, but in the medium to long term, instead of concentrating on the input side, government must use producer prices (output inventiveness) to drive production.”

He added: “The last five years have shown that supporting agriculture through inputs leads to abuse, diversion, corruption and speculation with little or no bearing at all to outputs. This policy shift is a major step in addressing agriculture production in the post land redistribution phase.”

Originally published by Financial Gazette website, Harare, in English 5 Jun 08.

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