Zimbabwe’s cotton sector poised for recovery

Zimbabwe’s cotton sector poised for recovery

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Zimbabwe’s cotton production is expected to recover in 2015/16, after collapsing to a near historic low in 2014/15. According to the US department for agriculture (USDA), seed cotton output will surge to 140,000 tonnes, following improved weather, up 40 percent from 90,000 tonnes in 2014/15, the second lowest outturn on record owing to the severe drought last year.
Ginning companies and merchants have also increased their commitments to contract farmers, to whom they provide inputs on credit that are subsequently deducted from the total sale price. This should drive a 10 percent increase in area planted to 210,000 hectares (ha). Zimbabwe’s cotton sector has historically suffered from a proliferation of ginners—peaking at 30 in 2008—which drove down utilisation rates to less than 20 percent of installed capacity (estimated at 600,000 tonnes).
Consolidation in the sector has reduced the number of ginners to eight, which should improve their commercial viability as they have access to more abundant supply of seed cotton. Ginners hope to increase their capacity utilisation to 70 percent over the next five years, but their ability to reach this target depends on robust cotton seed prices in Zimbabwe in order to prevent farmers leaving cotton for other more profitable cash crops.

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