Higher cotton output means bigger profits – expert

Sat, 24 Jun 2017 12:21:04 +0000

By BUUMBA CHIMBULU

INCREASING productivity of producers and ginners is the best way to improve the competitiveness and profitability of cotton production in Zambia, an international expert has said.

Mr Gérald Estur has also been engaged by the Cotton Board of Zambia (CBZ) to spearhead the introduction of a pricing model which would assist farmers in the sector sell their produce.

Mr Estur said low productivity for cotton translated into lower incomes for both farmers and ginners.

He was speaking at a cotton stakeholders’ workshop in Lusaka recently.

“Seed cotton price must be linked to international lint price. Pre-planting price needed to give visibility to stakeholders.

“As cotton prices will remain volatile and unpredictable, there is no silver bullet for designing a price-setting system. There is crucial need to have consensus between producers and ginners,” he said.

Mr Estur emphasised that pricing was one component of farmers’ cotton income and urged them to produce more of the commodity.

He also said strong Government support was key to cotton sector development in Zambia.

Mr Estur explained that low productivity of cotton translated into lower incomes for both farmers and ginners as producer prices could not be determined on the basis of cost of production of inefficient farmers.

“Some of the best pricing best practices include flexibility within the season, allowing for adaption to volatile world prices: price to be revised periodically and fair allocation of revenues and risks between producers and ginners.

“ Other practices are ensuring producer price was determined on the basis of the operating costs of efficient ginners, otherwise ginners’ inefficiencies would be passed on to producers

“Simple and transparent formula: producer price calculated as a fixed percentage of lint and seeds sales, based on easily accessible and verifiable references. Minimum guaranteed pre-planting price,” Mr Estur said.