Samuel Kadungure Senior Farming Reporter
SMALL-SCALE tobacco growers must book in their crop before delivery if normalcy is to return at the auction floors as this will give the system an estimated volume of the golden leaf to be supplied and inform the respective banks of monetary equivalence each farmer may require after transacting.
Chaos rocked the auction floors last week as banks ended up failing to pay farmers as per the Reserve Bank of Zimbabwe set threshold.
Farmers staged a demonstration at Tobacco Sales Floor (TSF) over the failure by banks to allow them to withdraw $1 000 as announced by a tripartite agreement among stakeholders. The farmers also complained over banks’ delays in processing their payments. However, this was partly blamed on impromptu deliveries which clogged the system, resulting in banks failing to meet cash demands by farmers.
RBZ has also moved to address bottlenecks related to banks failing to pay farmers the stipulated $1 000 per initial sell and $500 in subsequent sales.“There are a number of variables to that problem. First, the time that banks closed was different from that of auction floors. Banks closed earlier than auction floors and farmers would fail to access cash.“We have synchronised both the opening and closing times. Another aspect was the number of people who would require cash on a given day would be more than what a given bank would have anticipated. This would result in banks carrying less cash to the auction floors because turn out cannot be determined with certainty by banks,” said Dr Mangudya.
Dr Mangundya said banks should get figures of anticipated number of farmers on a given day from the Tobacco Industry Marketing Board (TIMB).Zimbabwe Farmers Union (ZFU) director, Mr Paul Zakaria, said farmers should cease impromptu deliveries to the auction floors as this congests the system and results in unnecessary delays.“There is a slight improvement from last week, the challenge is a system alignment.
There is no way banks will be able to anticipate the volumes and the cash equivalence as long as tobacco farmers are not booking their crop 24 hours before delivery. The farmers should book to help (the system to) estimate the volume of flue cured tobacco that will go through the auction system on a particular day so that banks prepare adequately,” said Mr Zakaria.
“Tobacco growers should be orderly; they should book their bales within the stipulated 24 hours and stop this habit of cutting corners,” added Mr Zakaria.Small-scale growers are taking advantage of a special arrangement compelling auction floors to make special arrangements (block allocation or reservation) to ensure that they (small –scale growers) are not penalised for their inability to book-in or deliver on a specific day.
Any bales offered in excess of a booking will not be allowed to sell and as a result any auction floor presenting such bales for sale shall be penalised in accordance with the agreement in place that year. When booking-in, a grower will be given a delivery date and the tobacco delivered will be sold on the booked selling day. However, if circumstances beyond the control of the licencee prevent such a sale, a grower may not claim prejudice. However, such tobacco once received must be booked–in. TIMB spokesperson, Mr Isheunesu Moyo, said the recently introduced e-marketing system was designed in such a manner that prevents un-booked sales.
“It requires at least 24 hours to book and sale. Deliver today and sale tomorrow, but farmers find it convenient to sell on delivery, sell and access cash on the same day,” said Mr Moyo.Tobacco Association of Zimbabwe (TAZ) president, Mr David Guy Mutasa, said the booking requirement was not a new thing.
“We have been conscientising our farmers on this requirement for years, but there are some who have never appreciated its soundness and do not book their bales before delivering to the auction floors. The conditions are the same, each individual tobacco grower should be banked, and is required to book their bales with the respective auction floors 24 hours before delivery,” emphasised Mr Mutasa.