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GOVERNMENT SETS WHEAT PRICES

By Vimbai Kamoyo

The government has set out prices for the coming winter wheat crop amid past fears of the value being eroded by inflation wrecking havoc in the economy.

Speaking at the post cabinet briefing the Minister of Information, Publicity and Broadcasting Services Monica Mutsvangwa said the government has set out prices for the wheat, citing influence of Russia/Ukraine war on the pricing.

“Cabinet received the 2022 Winter Wheat Pre-Planting Producer prices presented by the Minister of Lands, Agriculture, Fisheries, Water and Rural Development, Hon. Dr. Anxious Masuka.

Cabinet advises that the geopolitical developments in Eastern Europe coupled with COVID-19 pandemic are weighing heavily on the logistical and financial aspects of commodity supply chains and this is affecting fuel, fertilizers and wheat supply systems, including the price determination mechanisms.

Cabinet notes that the pre-planting producer price should be pegged at a level that will motivate farmers to plant additional hectares of wheat. The nation is informed that Cabinet approved as follows, the winter wheat pre-planting price for ordinary grade of wheat be set at ZW$155,000.00/MT (metric tonnes), that the winter wheat pre-planting price for premium grade of wheat be set at ZW$170,500.00/MT,” she said.

However, there are genuine concerns that the prices might mean little at the time of harvest as the local currency is tumbling almost every week.

The debt watchdog the Zimbabwe Coalition on Debt and Development (ZIMCODD) raised a red flag on inflation saying the situation had become dire.

“In recent weeks, Zimbabweans have witnessed an elevated massive decline of the Zimbabwe dollar (ZWL) particularly in the parallel market. Year to date, the local currency has shaved about 32% of its value on the official market. The latest weekly foreign currency (forex) auction results released by the Reserve Bank of Zimbabwe (RBZ) this week, 26 April 2022, show the ZWL plunging by 2.6% to settle at US$1: ZWL159.35. In the alternative (parallel) markets, the local unit is depreciating significantly with the US dollar now trading between the ZWL320-350 ranges.

“The average parallel market exchange premium, which is the percentage difference between the official and alternative exchange rates is now hovering above 100% against the globally accepted threshold for currency stability of at most 20%.

In short, the parallel market rate has become a reference exchange rate for most transactions in the economy, the reason is whenever parallel rates plunge, prices of basics also skyrocket. This, coupled with the impact of the Russia-Ukraine war on global energy, mineral, and food prices is fuelling domestic price inflation as Zimbabwe,” said ZIMCODD.

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