Tabitha Mutenga, Staff Reporter
AFTER receiving an early Christmas present last year, cotton farmers are once again faced with a tough year as the volatility of the cotton markets has led to the decline in international pri-ces, from US$2,37 per pound in March 2011 to US$1 early this year.
The 2011 cotton marketing season was characterised by record high lint prices which prevailed on the international market from late 2010 up to March 2011. Prices peaked to US$2,37/pound but experienced a downward spiral towards the end of March 2011.
"The record peak period was short-lived as it came at a time when the Zimba-bwean cotton was still in the lands and therefore not ready for marketing. This all happened during the growing season up to the time just before the marketing of seed cotton," said Cotton Ginners Association director general, Godfrey Buka.
"There was serious price volatility emanating from initially high demand for lint and speculative tendencies which pushed the prices up, resulting in very high prices being quoted on the international market," he said.
Much as it may be disappointing that international prices have since been falling, they are at least comparatively still better than lint prices for the years before 2010 when prices averaged 67 cents/pound. However, the market can be very volatile. Historically, lint prices have usually averaged between 50 cents and 80 cents/pound.
Compared to the region, Zimbabwe last year paid out the highest prices for seed cotton than its regional counterparts. Zambia paid 68 cents/ kg, Mozambique 70 cents/kg and Malawi 68 cents/kg, while the seed cotton prices in Zimbabwe ranged from 85 cents to US$1/kg and averaged at 91 cents/kg.
For the 2011/2012 season, the erratic rains at the beginning of the season affected germination in some areas where farmers had to replant twice, although planting was completed in December 2011 and germination was fair to good with the early crop now at the boll formation stage.
"The current rains have significantly improved the crop situation and it is likely that at least 265?000 tonnes of seed cotton can be produced from a hectarage of about 470?000.
"However, the high cost of production due to an artificial economic situation as well as the absence of subsidies remains a challenge to cotton viability," Buka said.
Some major producing countries such as India, China and the USA subsidise their farmers to enhance their returns.
"In our region, there are reports from Cotton Interna-tional that the Malawian government has provided US$10million in cotton subsidies to farmers with the aim of reducing reliance on tobacco as a major cash crop. This has resulted in the current hectarage planted in Malawi being doubled from 200?000 last season to 400?000 this season. Cotton International also reports that US Congress is planning to provide US$16 million cotton support to West African Countries through their USAID's West African Cotton Improvement Progr-amme," said Buka.
Zimbabwe has the potential to scale up production by about threefold the current cotton production levels because of existing infrastructure. The largest crop ever produced was 353?000 tonnes in 2000 or 50 percent of installed ginning capacity.
"This shows that there is still a long way to go as production is yet to match installed capacity. While we cannot control international prices we can ameliorate the effects of diminishing retu-rns by increasing productivity.
"A major factor of production that we cannot control is the high cost of production which has become our biggest challenge," Buka added.
"In order to overcome the threat of declining crop production, our thrust as a cotton country should be to implement proper agronomic methods to improve productivity and enhance quality. This can be achieved through the provision of adequate inputs and extension services to give advice in maintaining good farming practices. Against the background of viability challenges, there is need to concentrate more on improving yields so as to widen profit margins," he said.
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