Lack of foreign currency hampers seed purchases

Zimbabwe's newly settled and communal farmers face the prospect of this season's expected good rains falling on empty fields if the government does not distribute seed in time for the first plantings at the end of October. The official Herald newspaper reported on Tuesday that the US $30 million needed by the Ministry of Lands, Agriculture and Rural Resettlement to buy inputs like seed and fertiliser for distribution throughout the country, was yet to be released by the country's reserve bank. According to the Herald, the bank had raised the precious foreign exchange using tobacco revenues as security, but the money would not be released until the government had met certain terms. It was not immediately clear what these were. Government spokesman Steyn Berejena told IRIN that Zimbabwe's land reform programme, which saw thousands of white-owned farms transferred to black farmers, resulted in an increase in the amount of acreage to be planted this year and a corresponding shortage of seed. The government has a programme to buy seed from seed houses for distribution to new farmers through the Grain Marketing Board (GMB) and the Agricultural Rural Development Authority. "Government will need more seed this year to make sure enough is channelled to the needy farmers," Berejena said, adding that the farmers were hoping to use the predicted good rains to make up for the last two years' drought-induced losses. "The main thrust [for the government] is to assist newly settled and communal farmers because they don't have the resources to buy seed on their own," he said. "It has to be available in rural shops for purchase, or obtainable through a soft loan from the GMB by the end of October, when the maize planting season starts." He said the government had already sourced 10,000 mt of maize seed from neighbouring countries, and now just needed to pay for it. Up to 32,000 mt was currently available, but another 56,000 mt was still needed. "Although many other seeds like millet and sorghum are needed, the emphasis is placed on maize seed for food security," Berejena said. "We are raring to go - the seed has been found, we just need the money to pay the supplier," he explained. Economist John Robertson told IRIN there was a possibility that the Reserve Bank simply did not have the foreign currency the government needed, as many business people were holding onto their currency in anticipation of another devaluation. The Zimbabwe dollar was last devalued in February from Zim 55 to US $1 to a selling rate of Zim 848 to US $1, with the promise of devaluations every three months. "It is likely that exporters are holding back on repatriating their earnings and waiting for a devaluation, and it is unlikely that the currency will be sourced from the parallel market at a rate of Zim 5,000 to US $1, which would make the seed very expensive." He added: "It is a disgrace that Zimbabwe is importing seed ... we used to be an exporter. The country also runs the risk of importing seed not suitable for germination in this climate."