ZIMBABWE- Zimgold Oil Industries, one of Zimbabwe’s leading cooking oil producers has shown resilience in prospects of stiffer competition after the government’s decision to lift restrictions on the importation of several basic commodities.
According to Zim Independent, the government of Zimbabwe has taken deliberate moves to ease restrictions on imports of basic commodities, among them cooking oil, maize meal, and rice in a bid to stabilize a wave of price hikes.
Zimgold, a subsidiary of Parrogate Industries Private Limited, processes oil seeds, extracts vegetable oil, and refines crude oil into edible oil. The group has operations in Zambia, Malawi, Rwanda, and Zimbabwe.
In Zimbabwe, Parrogate’s flagship cooking oil brand Zimgold commands a 45% market share in the edible oil space and Zimgold Margarine has a 30% share of the packaged edible fats market.
According to Zimgold, the move has already been slammed by the Confederation of Zimbabwe Industries on the fear that it was likely to throw domestic manufacturers off balance,
However, Zimgold Oil Industries said it was not worried about prospects of stiffer competition adding that its product can stand its ground.
Additionally, Devesh Gautam, Zimgold’s finance controller allied fear that a flood of cheaper imports, mostly from South Africa, would create a healthy competition.
“Opening of borders by the ministry (Ministry of Finance and Economic Development) will help us,” he said
According to him, the move will ease pressure on the company since consumers would realize that imported cooking oil from South Africa might have prices that are much higher than what Zimgold sells, creating a competitive advantage.
The corporation also issued a commercial paper to raise US$5 million for investing in a planned production ramp-up, targeting 100 000 tonnes of soybeans and sunflowers.
The cooking oil maker wants to use the paper, which has a prescribed asset status, to raise capital for purchasing soya beans and sunflower seeds from regional farmers.
“Initially, we wanted to put a minimum amount of US$100 000 but then we were advised that we are coming into the market for the first time and we need to understand how it works because we are launching this instrument for the first time. So, we ended up putting US$5 000 as the minimum amount for subscription,” Gautam said.
The company has expanded its operations to include bakers’ fat, margarine, laundry soap, bottled water, and bathing soap.
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