Zambian Farmers Oppose Controls to Subdue Record Corn Prices
Zambian Farmers Oppose Controls to Subdue Record Corn Prices
(Bloomberg) -- Zambia’s biggest farmer-lobby group is opposing any efforts by the government to introduce price controls on the southern African nation’s corn after a drought reduced output. The government says there are no price caps.
“The Zambia National Farmers’ Union would like to disassociate itself from such acts as we have always believed in a free-market environment,” it said in an emailed statement on Sunday.
Prices of corn, which Zambians eat as a thick porridge for most meals, have surged to a record this year after the worst drought in nearly four decades hurt growers in the southern and western parts of the country. Floods in other regions also curbed output. The government has said there are sufficient corn stocks and has so far resisted calls to declare a national disaster. The price of the cereal plays a prominent role in the nation’s politics.
Agriculture Minister Micheal Katambo blamed the situation on panic buying. He called a meeting with grain traders, corn millers and retailers last week, and they agreed to reduce the price they buy corn to 130 kwacha ($9.92) for a 50-kilogram (110-pound) bag, he said. The decision was made by the buyers, not government, and doesn’t amount to price controls, according to Katambo.
Private buyers have been paying as much as 170 kwacha, while the country’s Food Reserve Agency’s purchase price is 110 kwacha, according to an Aug. 22 government statement.
“This is what I would call a very commendable decision by the key stakeholders, being patriotic, taking care of human life,” Katambo said by phone Monday. “This is not true that government has introduced price controls. The policy of government is against price controls.”
The average national retail price for corn meal was 41% higher in July than a year ago, helping to push inflation to 8.8% year-on-year, the highest level since November 2016.
To contact the reporters on this story: Matthew Hill in Maputo at mhill58@bloomberg.net;Taonga Clifford Mitimingi in Lusaka at tmitimingi@bloomberg.net
To contact the editors responsible for this story: Paul Richardson at pmrichardson@bloomberg.net, Hilton Shone, Michael Gunn
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