• Government has enacted Statutory Instrument 87 of 2025, requiring processors to source at least 40% of their grain and oilseed needs locally by April 1, 2026, rising to 100% by 2028
• The policy aims to reduce Zimbabwe's reliance on imports, boost local agricultural production, and support smallholder farmers
• Processors will pay the difference between import and local prices into the Agricultural Revolving Fund, which will support farmer development and agricultural investment

Sources: Zimbabwe National Statistics Agency, Equity Axis Research

Harare- Zimbabwe's Ministry of Lands, Agriculture, Fisheries, Water and Rural Development has enacted a regulation that, if implemented as written, will fundamentally restructure the country's entire grain and oilseed processing industry within two years according to the latest Statutory    Instrument (SI).

SI 87 of 2025, gazetted in early September indicates that from 1 April 2026, every processor in Zimbabwe, every miller, stockfeed producer, and food manufacturer that handles grain, oilseed or related products must source at least 40% of its annual raw material requirements from domestic suppliers.

 From 1 April 2028, that figure rises to 100%. There will be no import route left open for routine procurement. The law is, on paper, the most sweeping localisation mandate Zimbabwe's agricultural sector has ever seen.

Zimbabwe's food import bill climbed to US$976.1 million in 2024, a 55.2% increase from US$628.9 million in 2023, but declined to 443.49 million in 2025 (2025 due to improved yield) largely driven by a severe drought that devastated domestic grain production. Grain imports, especially maize, surpassed US$1 billion when combined with oilseeds and related products, according to data from the Reserve Bank of Zimbabwe.

For a country that already spends more than US$2 billion annually importing fuel, the addition of a billion-dollar grain import bill compresses foreign exchange reserves, widens the trade deficit, and creates a structural dependence on external food supply that is politically and economically untenable.

SI 87 of 2025 is the government's answer to that dependence,  a legislative mandate designed to force the private processing sector to underwrite domestic agricultural production by guaranteeing it a market regardless of what the import price is doing on global markets.

The commodities covered by the new legislation include maize, wheat, soya, sunflower, cotton, and related meat value chains, effectively the entire basket of primary agricultural inputs that Zimbabwe's milling, stockfeed, and food manufacturing industries depend upon. The pricing architecture embedded in the regulation is where the policy becomes most consequential for the business models of processors. The instrument defines two benchmarks,  the import parity price, meaning the full landed cost of grain in Zimbabwe including freight, insurance, and associated charges; and the production parity price, meaning the government-determined local price for grains and oilseeds.

Where the import price falls below the local production parity, meaning the cheapest available supply is the imported one , the difference does not flow to the processor as a cost saving. It is paid into the Agricultural Revolving Fund. The practical effect of this provision is to remove the price incentive for importing.

Even when global markets are cheaper, processors cannot capture that cheaper price. The policy is not merely mandating local sourcing, it is structurally eliminating the financial logic of choosing imports over domestic grain.

The ambition embedded in that architecture is clear and the political economy rationale is coherent. Farmers who know their product has a guaranteed buyer at a protected price will plant more. More planting leads to higher domestic supply. Higher domestic supply progressively reduces the import bill and the foreign exchange drain. The Grain Marketing Board's network of over 1,800 maize collection points across the country provides the logistical infrastructure to aggregate supply from smallholders and channel it to processors at scale.

The problem, and it is a serious one, is that the demand side of this equation is being legislated faster than the supply side can respond. Oilseed yields in Zimbabwe remain at 1 to 2 tonnes per hectare against a potential of 3 or more tonnes per hectare, constrained by climate risks and production volatility. Zimbabwe's annual maize consumption sits at approximately 2 million tonnes, and the 2024/2025 season produced a harvest well below that requirement, creating an immediate import need estimated at 700,000 tonnes.

The country cannot currently feed its mills from domestic production alone. That is not an opinion,  it is the number. When SI 87 was first gazetted, millers in the Southern Region were vocal about the immediacy of the supply problem. Representatives of the milling industry warned that plants did not have adequate raw material and that even available mealie meal was insufficient to stock retail shelves, ultimately prompting a partial relaxation that allowed imports to continue against a flat levy of US$10 per tonne paid into the Agricultural Revolving Fund.

That climbdown, within weeks of the gazetting, is a candid admission that the regulation, as initially written, arrived before the agricultural production base it requires was in place. 

The 2025/2026 summer season oilseed targets include approximately 77,000 hectares for soybeans, 160,000 hectares for sunflower, 270,000 hectares for cotton, and 385,000 hectares for groundnuts, with oilseed hectarage targets more than doubled and sunflower contract farming programmes exceeding 100,000 hectares. Those are ambitious planting targets, and if achieved with improved input availability, adequate rainfall, and effective extension support, they would meaningfully close the gap between current domestic supply and the 40% local sourcing threshold that takes legal effect on 1 April 2026.

The question is whether those targets are realistic given Zimbabwe's agricultural track record over the past three seasons, which have been shaped by El Niño-induced drought, input financing constraints, and infrastructure limitations in the irrigation sector that have capped yield potential well below what the land is capable of producing under favourable conditions.

The 2028 deadline, 100% local sourcing, is where the policy's credibility is most severely tested by the numbers. Zimbabwe's current soybean production has been declining, due to drought impacts. The industrial demand from processors, stockfeed producers, and edible oil manufacturers runs substantially above that level. Closing the gap to zero imports in two years, while also expanding maize production to cover the full 2 million tonne annual consumption requirement, scaling sunflower output for the cooking oil industry, and growing wheat to reduce flour import dependence,  requires a simultaneous acceleration across multiple value chains under a macroeconomic environment characterised by the 35% central bank policy rate that makes the commercial financing of agricultural production among the most expensive in Africa.

A smallholder who wants to plant a hectare of soybean cannot borrow against next season's harvest at commercially viable rates when lending to ZiG borrowers requires above-45% interest to be commercially feasible for banks. 

There is also the infrastructure dimension that the regulation's implementation will expose directly. Zimbabwe is expanding its grain storage capacity from 750,000 to 1.5 million tonnes through 14 new smart silo complexes incorporating IoT sensing, automated environmental controls, and digital management platforms , with the Kwekwe complex already commissioned and facilities planned for Beitbridge, Gwanda, Lupane, Gokwe, Masvingo, and Mutare.

That storage expansion is essential to the SI 87 framework, because the logistical challenge of connecting dispersed smallholder production to processors at scale is as significant as the production challenge itself. If grain is harvested but cannot be aggregated, stored at quality, and transported to mills reliably, the 40% local sourcing mandate creates a supply chain bottleneck that drives up processor input costs, squeezes margins that are already thin, and risks being passed through to consumers in the form of higher mealie meal, cooking oil, and stockfeed prices,  inflation pressures that would land most heavily on the lowest-income households the food security objective is ultimately designed to protect.

The pricing mechanism built into the regulation,  directing the gap between import parity and production parity into the Agricultural Revolving Fund rather than to processors, will over time create a capitalised fund that can theoretically be deployed into farmer support, input subsidies, and irrigation infrastructure. That is the circular logic of the policy: the cost savings processors are denied by being prohibited from buying cheaper imports are recycled back into improving the domestic supply chain that will eventually eliminate the need for those imports.

It is a coherent long-term model. The tension is that the recycling of capital through a government fund into agricultural investment operates at a speed and reliability that Zimbabwe's institutional track record does not unambiguously support. The Agricultural Marketing Authority, the Grain Marketing Board, and the broader government agricultural support infrastructure have all faced resourcing and governance challenges that have historically limited their effectiveness at the delivery end of exactly these kinds of policy commitments.

What SI 87 of 2025 represents, read in full, is a government that has decided the cost of agricultural import dependence is no longer acceptable and is using the only instrument directly within its control , a legal mandate on the processing sector , to force a structural change that market incentives alone have not produced. The ambition is correct. The diagnosis is accurate. The timeline is aggressive. And the success of the entire framework depends on a set of conditions,  adequate rainfall, accessible input financing, functional GMB logistics, expanded irrigation, consistent policy implementation, and a processing sector that can absorb the cost pressures of mandatory local sourcing without passing them entirely to consumers, that have historically been difficult to maintain simultaneously in Zimbabwe's agricultural economy.

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