Domestic economy responds to global instability

By Owen Mandovha

GOVERNMENT has intensified support for local wheat farmers to ensure the availability of bread and other products at affordable prices, after supplies in key traditional grain markets were disrupted by the situation in Eastern Europe.

Rising insurance and shipping costs in addition to disruptions of supply chains in Zimbabwe’s traditional grain markets of Russia and Ukraine has forced millers to source wheat from even more expensive wheat producers such as Australia and Canada.

The Grain Millers Association of Zimbabwe (GMAZ) says in addition to other cost drivers such as fuel, prices of bread and mealie meal have not been spared from the ongoing global instability.

“At the beginning of the year, a tonne of imported wheat was around US$580 from Russia and our ships have been returned since December. Now we are getting it from Australia and Canada where it is hovering over US$700. This has led to a spike in all cost drivers along the value chain, which has sparked a revision of bread prices,” said the chairperson of the Grain Millers Association of Zimbabwe, Tafadzwa Musarara.

Government has since assured wheat farmers of uninterrupted power supply for irrigation to safeguard long term flour self-sustenance.

This was revealed by the Minister of Energy and Power Development, Honourable Zhemu Soda during this Wednesday post cabinet.

“We have ring-fenced power to wheat farmers to the tune of 100MW so that our farmers can produce to the maximum. The support we are rendering them will ensure that we have secured our future supplies of wheat for self-sustenance,” he said.

Mitigatory measures such as import substitution policies implemented by government way before Russia’s special military intervention in Ukraine, have to a larger extent cushioned the economy from external shocks which have equally pushed inflation in the Eurozone and the US to historic record highs of between 7.4 and 7.9 percent.