Zimbabwe cotton seed farmers to get $40 cash per bale

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Zimbabwe cotton seed

Zimbabwe cotton seed

Cotton farmers will receive $40 in cash per bale upon delivery while the balance will paid directly into their accounts, central bank governor John Mangudya has said.

cotton seed farmer

cotton seed farmer

“The bank, in consultation with the Agriculture Marketing Authority (AMA), the Cotton Ginners Association of Zimbabwe (CGAZ) and Cotton Merchants, has established a framework for payment for seed cotton in terms of which each seed cotton grower shall be paid $40 in cash per bale, and the balance being paid directly into the grower’s bank account and/or through mobile wallet,” said Mangudya in a statement at the weekend.

The central bank wants farmers to either open low cost bank accounts or register for mobile banking to facilitate payments.

Critics, however, say the move will also make farmers liable to paying tax.

In March this year, Zimbabwe’s tax agency, ZIMRA, directed the tobacco industry regulator to withhold 10 percent of the money payable to farmers who did not have tax clearance certificates.

According to the Agriculture Marketing Authority, cotton seed sales in the 2016/7 season to June amounted to seven million kilogrammes.

A standard cotton bale weighs around 225 kg, with seed accounting for about half of the weight.

Zimbabwe is expecting about 110 000 tonnes of cotton this season after good rains.

The government has set the price of cotton at 47 cents per kilogramme.

The central bank also discouraged farmers from side marketing.

“Please also note that in terms of current regulations governing the marketing of seed cotton, side marketing is a punishable offence. Cotton farmers are therefore advised to desist from this practice,” said Mangudya.

During the 2016/17 cropping season, Government supplied $36 million free cotton inputs to growers through Cottco to boost production of the crop.

But Cottco has been failing to pay cash for the delivered crop, forcing farmers to sell to private buyers.- The Source

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