ZIMBABWE – Seed Co Limited, a listed agricultural entity has reported a 28% decline in seed sales volumes for the third quarter, a consequence of delayed rains and diminished enthusiasm for cropping due to the El-Niño phenomenon.
Presenting a trading update for the third quarter ended December 31 2023, SeedCo Group Secretary Tineyi Chatiza revealed that despite reduced seed sales, drought resistant small grains and legumes had a huge demand during the review period.
Chatiza said in the period under review, total volume sold amounted to 18 520 tonnes, compared to 25 814 tonnes recorded in the preceding year.
Revenue in inflation-adjusted terms, however, increased by 41% to ZWL$266.5 billion (US$828M) whereas the operating profit rose by 1 582% to ZWL$484.6 billion (US$1.5B).
According to the report, the increase in revenue, whether assessed historically or adjusted for inflation, aligns with the increasing proportion of US dollar denominated sales against the pronounced depreciation of the exchange rate and the resulting inflationary impacts.
The executive said the enhanced profitability outcome could be credited to the restoration of profit margins and the alignment of the exchange rate with open market forces experienced in the better part of the first half.
Drought resistant small grains demand surge amid delayed rains
Meanwhile, Seed Co Limited says that delayed rains have spiked demand for drought resistant small grains and legumes as the country continue to grapple with frequent droughts and erratic rainfall.
The devastating situation has, over the years, forced Zimbabwe to import maize, the country’s staple food due to poor harvests and chronic food insecurity.
Recently, the Food and Agriculture Organization (FAO) urged policy makers in Zimbabwe to promote the adoption of locally adapted crops, which include traditional and other neglected species to boost nutrition security.
FAO said locally adapted crops had the capacity to bring diet diversification to citizens while enhancing nutritional quality and diversity of diet
Additionally, the government is trying to wean Zimbabweans off maize in arid parts of the country, encouraging them instead to grow traditional small grains like sorghum and millet, which are drought-resistant.
“From an operational perspective, the delayed rains this season led to increased demand for small grains and legumes, extending into the last quarter of the financial year in Zimbabwe and neighboring countries.
“This demand for small grains holds significant potential to clawback annual sales volume performance not only in Zimbabwe but also in neighboring countries,” Chatiza said.
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