Local media are reporting that so intense is the price war that the state-owned grain buying firm, the Food Reserve Agency (FRA), also faces fierce competition from foreign dealers from East Africa.
According to the reports, the price of maize in parts of Zambia, especially in the north, has dramatically increased to K100 for a 50kg bag, from K50/50kg.
Grain buyers, mostly from Kenya and Tanzania, are reportedly enticing maize farmers with better offers.
“The foreign buyers are all over the place and they pay cash,” said Field Simwinga, Nakonde District Commissioner in Muchinga Province.
Simwinga said with a little patience, the maize price could rebound to K200/50kg – the price it obtained before an export moratorium was imposed. The moratorium, which lasted for 18 months, has been lifted.
Zambia this year recorded a bumper maize harvest of 3.6 million tons. This is sufficient to meet the country’s grain requirements, leaving an excess of more than 1.4 million tons for export. Government also took steps to waiver the 10% export duty and clear other impediments to make Zambian grain more competitive on the international market.
East-Africa, experiencing a shortage of maize following severe drought, is seen as a lucrative market for local maize producers.
Simwinga said the buying spree of the foreign grain traders might leave the FRA in a quandary, as it had not yet stated the price it will pay farmers, or said when it will start buying crops.
“There may be little for FRA to buy,” he said.
It is also feared that many farmers are selling their entire crop without keeping some for their own consumption.
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