Vol.23 No.185

Friday 8 December 2006    
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News
Price hikes choke staple food sector

KETO SEGWAI
Staff Writer

12/8/2006 4:05:28 PM (GMT +2)

In the past nine months, sorghum meal (bopi jwa mabele) - the national staple - has disappeared from the ordinary Motswana's diet because of a dramatic price increase of about 97 percent. Currently, a 10kg packet is selling for a whopping P40-P45 up from P24 in January. In contrast, maize meal (phaleche) still costs about P27 per 12kg bag.


The sorghum millers' nightmare started in March this year when the Botswana Agricultural Marketing Board (BAMB) unleashed a series of price hikes. BAMB is the sole major buyer and seller of sorghum. Since March, it has hiked its retail prices for a 50kg bag from P55 to, P62 to P70 to P83 to P86.25 and P108.30. This means the retail price per ton is P2,166.

The runaway sorghum meal prices have riled consumers and millers alike. The 100 plus member Botswana Confederation of Mill Owners (BCMO) have effective from December 1 taken up the issue with relevant authorities in Gaborone.

They argued that the skyrocketing prices are not only unsustainable but are putting the whole milling industry in jeopardy. "As you are aware, bogobe jwa mabele is the national staple food of choice. Obviously then, once it is affected there should be a crisis in the food industry.

"As food processors, our businesses have been shattered ever since BAMB started increasing prices. Our sales have plummeted. Batswana ba re bopi jwa mabele bo a tura. And painfully, we agree with their view," a BCMO representatives explained to Mmegi this week.

The millers fears that the crisis is going kill the production of the nation's staple food. With prices so high, customers are likely to divert their attention to other more affordable cereals, most of which are imported, such as rice and macaroni.

The local millers, who have over the years established themselves as reliable suppliers to big retailers, chain-stores and supermarkets find themselves in a Catch-22 situation.

These outlets cannot entertain any price increase at this time of the year - during the highly competitive festive season when every manufacturer is giving discount by slashing the prices. "So we are just giving our products for free. What can we do," asked a miller.

The source of the threat to national food security appears to be none other than the BAMB. Through their interaction with BAMB, the millers say the organisation claimed to have imported the current stock of raw grains from the United States. BAMB resorted to imports because there was low out-put from their natural bulk suppliers in the Pandamatenga farms during the last harvesting season. BAMB finance manager, Elvis Ncaagae explained that the Pandamatenga farmers produced 10, 000 metric tonnes of sorghum this year. "This is less than what is normally produced (20,000mt to 30,000mt) in this area. BAMB imported 27,500mt from the United States."

The millers have since appealed to the Minister of Agriculture, Johnnie Swartz, whom they met last Friday, in the company of his Assistant Peter Siele, deputy Permanent Secretary Micus Chimbombi and deputy director of Crop Production, Edison Woto.

Yesterday Woto told Mmegi the minister has assigned his department to collate all the data on the trend of similar commodities. "This case is likely to impact on policy so we need all the necessary information. We expect to have completed the exercise by next week."

The millers consulted with the Parliamentary Committee on Agriculture and Environment on Wednesday is chaired by Boteti South legislator Lebonaamang Mokalake with Ronald Ridge (Maun West), Olebile Gaborone (South East North), and Christian De Graaff (Ghanzi South) as members. Mokalake confirmed to Mmegi that the meeting took place and said that normally they take cases and try to separate issues according to relevant ministries. "In the case of the millers, we realised this falls under the auspices of manufacturing, which is under the Ministry of Trade and Industry."

Mokalake disclosed that since the case is likely to involve policy matters, the committee intends to facilitate a meeting of the ministries of Agriculture; Trade and Industry; and Finance and Development Planning.

The solution to the crisis, however, appears to lie within the Act that established BAMB. The Act provides for a Stabilisation Fund, which the millers strongly feel should be used to cushion the besieged industry. Mmegi has since established that the fund has never been utilised before. Section 12 Cap 74:06 of the BAMB Act calls for the establishment of the fund to stabilise prices paid by the board from time to time in respect of scheduled produce, or for such other purposes as the board may from time to time determine with the approval of the minister. The 1974 BAMB Act had set the stabilisation fund maximum limit at P1 million. However Section 15, which deals with shortfalls, reasons that should there be insufficient moneys in the stabilisation fund to meet the whole of deficiency, "then, to the extent of the shortfall, (it can be met) from the development fund".

As the government looks at the matter, Batswana will seemingly hit the festive season with restrained consumption of their favourite food. Though the local millers have an option of importing sorghum from South Africa - at a cheaper rate of about P1,760 per ton (inclusive of transport to southern Botswana) they still purchase from BAMB at P2,166 per ton. The main hitch, according to the millers, is that the locally grown sorghum is of better quality than anywhere in the world. BAMB pays local producers P1,350 per ton (mainly Pandamatenga farmers) and P1,160 per ton for other producers.

The head of co-operative marketing at the department of crop production, Abakeng Kuswane said Botswana's total national sorghum requirement this year stood at 57, 000mt. But on good years it ranges between 60 - 80,000mt.

"About 23,054mt of that was produced locally, but that figure include 10,000mt of strategic grain reserve," he revealed. Send us your comments about Mmegi newspaper Search For Old Newspaper Editions To advertise contact us through email

 
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