Forex shortages weigh down oil expressers


    THE cooking oil industry is operating at between 30% and 40% capacity, weighed down by the shortage of foreign currency to import key raw materials, an official has said.

    Oil Expressers Association of Zimbabwe chairperson Busisa Moyo told NewsDay that the challenges involving foreign currency allocation for the sector remained critical, thereby affecting industry performance.

    “The situation remains critical and we trust that the availability of soya beans from the local crop and tobacco foreign currency inflows (will) buoy performance for the quarter commencing April 1,” he said.

    “The industry is operating at between 30%-40% of refining, but 0%-10% soya bean crushing capacity,” Moyo said.

    He said as a sector, they were still struggling to meet national demand due to a number of challenges.

    “Consumers are not getting enough oil as they would ordinarily want to get and we see “consumer-self-rationing” in urban areas but are concerned that rural markets are not getting enough at affordable prices,” Moyo said.

    He said they required 10 000 metric tonnes of crude oil per month which amounts to circa $10m ($120m per year). The stockfeed manufacturers, who could not get soya meal protein feed (by-product from oil extraction), also import 12 000mt at circa $6m ($72m) per month.

    “This is, however, better than importing bottled oil, eggs and chickens, which are all products of the soya value chain and create employment locally.”

    “We, however, need the banking sector, international development partners, Agricultural Technical and Extension Services, Agricultural Marketing Authority, Grain Marketing Board, Agricultural and Rural Development Authority, Ministry of Agriculture and private sector soya value chain players to work together for the 2018/19 season increase the hectarage under soya,” he said.

    Moyo said extensive discussions, meetings, workshops and research had commenced between government and private sector to tackle the impediments and begin preparing early for the planting season.

    “The challenges remain adequate local grown oil seeds and foreign currency for raw materials and re-tooling. The sector, albeit, is still growing and so is our membership. We have advised that new entrants into the sector should ideally support their future raw materials through contract farming or other schemes that don’t create pressure on an industry that already has excess capacity,” he said.

    – Newsday


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