- Sales volumes rose by 56.6%
- Govt support for local wheat production also spurred sales
- Group total sales volumes increased by 45.4%
Harare- Seed Co Limited’s registered an increase wheat seed sales volumes in the quarter ended 30 June 2020 (Q1 2020).
Volumes sold were 56.5% higher than the prior comparative period due to improved irrigation capacity which benefited from rising water levels and better electricity supply.
The Group added that sales were also spurred by government’s commitment to reduce imports by supporting local production of wheat.
Government is targeting 80 000 ha from the 2020 winter wheat programme with 65 000 ha being financed by Government through guarantees amounting to ZWL$1.8 billion while the balance is being financed by private contract financiers.
Zimbabwe requires about 350 000 mt of wheat/flour annually.
The Group’s total sales volumes in the period under review increased by 45.4% from the corresponding period last year with wheat seed and barley seed respectively making up 91.6% and 8.1% of the total sales volumes in the period under review.
Barley seed sales dropped by 20.3% compared to the previous year as the major customer cut back its seed uptake for malt production in response to reduced beer consumption arising from constrained customers’ disposable income and the COVID-19 lockdown.
The Group’s historical cost revenue in the quarter grew by 1 097%, reflecting the inflationary selling price increases and volume growth while operating profit rose by 577% in historical cost terms.
Going forward, Seed Co says its strategic position at the base of the food value chain, and the concerted effort by the Zimbabwean government, regional governments and other key stakeholders to ensure food security is expected to help the Group’s performance remain resilient in the amid the prevailing economic challenges in Zimbabwe which have been exacerbated by the COVID-19 pandemic.
In addition, the Group is soldiering on amidst severe funding constraints to commission the game changing US$12.5 million Artificial Seed Drying Facility at Stapleford in Zimbabwe before the end of the year.
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