Emergency Foreign Allocation Extension for Fertilizer Industry

Representatives from the fertilizer industry, as well as CZI, met to discuss strategies to use in lobbying Government to extend support in foreign currency to the industry for its Ammonium Nitrate (AN) fertilizer production.

A total amount of US$24.5 million is required monthly for its production of 70 000 tons of AN and one ton of ammonia gas to produce two tons of ammonium nitrate and the ammonia gas is imported.

Currently ammonium nitrate lands in Zimbabwe at US$500 per ton and its retail price is ranging between US$30-US$39 per 50kg bag, translating to between RTGS$100 and RTGS$120.

However, with government support extended towards Sable for example, their 50 kg bag of fertilizer will sale at not more than US$27, translating to between RTGS$79 and RTGS108, cheaper than any prevailing retail prices.

The argument is that, imported fertilizer may not be suitable with the Zimbabwe soil types as they are made to suit the climatic conditions of the countries they are produced, thus not only do they kill our soils they also result in very low yields, hence the need to have a policy position in place that promotes and supports locally made fertilizers.
Such policies, if implemented will assist in preserving the foreign currency which can therefore be channelled to other critical needs.

The meeting agreed on the price advantage of not more than US$27 or below RTGS$108 equivalent, compared to prices of above US$30, currently prevailing in the market.
The meeting also found it very crucial to safeguard hundreds of jobs in the industry and the need to protect investment made.

The meeting further agreed to solicit comments from various stakeholders, to input into the initial draft, before presentation to the Governor of the Reserve Bank, Minister of Finance & Economic Development as well as to the Minister of Lands, Agriculture, and Rural Resettlement.

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