SPECIAL REPORT

ZIMBABWE

5 July 2004

• Highlights
• 1. OVERVIEW
• 2. SOCIO-ECONOMIC SETTING2
• 3. MAIN FACTORS AFFECTING FOOD PRODUCTION IN 2003/04
• 4. MAIN SEASON PRODUCTION ESTIMATES
• 5. CEREAL SUPPLY/DEMAND BALANCE, (APRIL/MARCH)
• APPENDIX

Highlights

1. OVERVIEW

This report is based on agricultural assessment fieldwork in three provinces: Mashonaland West, Manicaland and Matabeleland North. These represent about one-third of total cereal production. Standing crops in other producing areas were also observed while travelling to the three provinces above. By combining direct detailed observations, other visual inspections, and information gathered from independent sources, including a range of industry experts, the authors believe they obtained reliable information on areas covering about 50 percent of national cereal production. Putting together information on the growing season, the condition of standing crops, rainfall data, the number of replantings needed in many areas, shortages of every type of agricultural inputs (draught animals, quality seeds, fertilizer, labour and credit), as well as evidence from successive dekads of satellite imagery, the Mission estimates this year’s cereal production at just over 950 000 tonnes within a 10 percent range, due to remaining uncertainty. The chief factors responsible for this outcome are presented in Section 3 below.

In the parts of the country visited by the Mission, discussions with local Agricultural Research and Extension (AREX) officials and with farmers indicated that 30 to 40 percent of the population in those areas would not only face a food deficit in 2-3 months’ time (i.e. by June-July) but would also have extremely little or no coping mechanisms left. Particularly vulnerable will be households headed by women, children or the elderly. The HIV-AIDS pandemic is rendering increasing numbers of households helpless by claiming the lives of the breadwinners. A significant number of other people will have exhausted their produced food stocks in 5-6 months time. However, many of them may be able to cope by selling livestock, panning for gold, collecting wild foods, or by depending on remittances from relatives working in cities/towns within Zimbabwe or abroad.

Although livestock condition appeared quite good in most areas visited, many losses occurred during the long drought of November-December 2003, and the incidence of Foot and Mouth Disease has hit the sector hard. Livestock prices are low in certain areas due to lack of demand – as low as Z$700 000- Z$1 million per head, while significantly higher (Z$1.5 million or so) in others. A significant proportion of households no longer owns any livestock at all (cattle, goat, sheep or donkey); in the typically livestock-dependent Matabeleland, about half of households are now reported to fall in this category.

For 2004/05, human consumption requirements (based on the 2002 Population Census, as updated, and utilization of 163 kg of cereals per person/year) should reach almost 1.94 million tonnes. This would imply a total import requirement for 2004/05 of nearly 1.3 million tonnes.

Despite a reported substantial reduction in this year’s production of tobacco, foreign exchange reserves have increased as a result of stricter Government controls over foreign exchange transactions, including remittances from abroad. Even with competing claims for foreign exchange, the Government will have the means to import substantial quantities of foodgrain, maize in particular.

As of the end of March 2004, it is believed that the GMB held stocks of about 60 000 tonnes of maize¹, with another 220 000 tonnes of maize contracted last year for 2004 delivery. If one assumes that another 400 000 tonnes may be commercially imported by GMB, and that the private sector will cover the wheat and rice deficit estimated at 285 000 tonnes, total commercial imports this marketing year should be just over 900 000 tonnes. Given the 60 000 tonnes of food aid available in the country, there would remain a significant cereal uncovered deficit of about 325 000 tonnes in 2004/05, to be met by further commercial imports and/or food aid.

2. SOCIO-ECONOMIC SETTING²

Zimbabwe’s economy has been sharply contracting since 1998. The country’s GDP (at 1990 prices) declined by around 40 percent between 1998 and 2004. The shrinkage in 2004 compared to 2003 is of the order of 9 percent. Unemployment and under-employment are rampant. For casual work, on or off-farm, the wage rate actually paid is often much below the official minimum wage of Zim$191 000/month.

Inflation, peaking at 620 percent on an annual basis in November, 2003 has seriously affected economic activity and people’s welfare. The poverty ratio is very high; even before the 2002 crop failure, 75 percent of the country’s population was classified as poor and about 42 percent as very poor. If anything, the poverty situation may be worse now in view of a poor harvest in 2003, as well and the continued economic crisis. The poor include the rural population of farmers, most of the informal sector workers, former farm workers, and the urban unemployed or under-employed.

With a sharp drop in the production of tobacco, and a downturn in tourism, the outlook for export revenues during 2004/05 is mediocre, despite higher cotton production and, possibly increased platinum and gold exports. As a result of the new monetary policy strictly regulating the foreign exchange transactions as of December 2003, Government access to foreign exchange has improved. The parallel market, which was thriving last year, has shrunk significantly. Exporters are required to surrender 25 percent of their export earnings at an exchange rate of Z$824 per US$, the remainder being auctioned at official Reserve Bank auctions. Remittances from abroad are much better managed than in the past. The Government should, therefore, be able to commercially import substantial quantities of food grains, essentially maize, in 2004/05.

Current agricultural policy has adversely affected production of maize and wheat. There is little incentive for farmers to produce beyond their subsistence needs, given price controls and the lack of alternative markets. The purchase price for 2003/04 season maize was announced in May 2004, not at planting time. Many of the farmers who sold maize to the Grain Marketing Board, in May or June 2003, had to wait up to 6-8 months before getting paid. This left them with no working capital for the planting season of October/November, 2003. Largely as a result of this, areas planted to maize in the major producing areas of Manicaland and Mashonaland are estimated to have dropped by between 9 percent and 37 percent. A small increase of 17 percent was registered in Mashonaland West, but this was against a low base for planted area in the 2002/03 season.

3. MAIN FACTORS AFFECTING FOOD PRODUCTION IN 2003/04

3.1. Rainfall

2003/04 rainfall graphs for a sample of ten stations, compared to last year’s and to the long term average, are presented in Figure 1 of the Appendix. The rains began in October, starting with the southern provinces of Masvingo and Matabeleland South. Rainfall during October in Beitbridge, Bulawayo and Plumtree was well above normal. In the important maize-growing Mashonaland Provinces, however, while rainfall in October was above normal, it was well below average in November and December. Those farmers who planted with the early rains had to contend with a long dry spell in November and in the first dekad of December and, in many cases, lost their first plantings.

The first effective rains for many areas arrived in the last week of December. This was followed in the first dekad of January with widespread heavy rains, especially in the Mashonalands and Manicaland. Rainfall in Matabeleland South and Masvingo, as shown in Figure 1 of the Appendix, was below normal in January. The second dekad of January was generally dry, putting some crops in the south under moisture stress, but heavy rains occurred across the country in the last dekad of January, which in some areas such as Kadoma District, caused local flooding and water-logging of crops. Dry conditions returned in the first dekad of February, with the exception of Manicaland. In mid February, Northern Matabeleland and Mashonaland West received above average rainfall, while Masvingo was largely dry. This was followed by widespread rains over the whole country in late February and early March. The Banket and Karoi areas in Mashonaland West received lower than average seasonal rainfall, with Banket only receiving 58 percent of its annual average. Karoi recorded 694 mm of rain against 904.4 mm of the past season, while Harare Airport station only received 548.9 mm against its long term average of 770.1 mm . While overall rainfall amounts throughout the country were at or above average, poor distribution of precipitation contributed to crop failure in many parts of the country.

Cumulative rainfall data from Manicaland, Mashonaland East, Mashonaland Central and Mashonaland West which together used to produce up to 80 percent of national maize production show that the 2003/04 season was distinctly unfavourable to maize production. The rainfall data shown in Figure 2 of the Appendix was extracted using Interpolated Estimated Rainfall (IER) images provided by FAO/ARTEMIS. The IER images (pixel size of 7.6 kms; dekadal update frequency) provide quantitative estimates of rainfall over Africa. They combine METEOSAT derived Cold Cloud Duration (CCD) imagery and data on observed rainfall. The dekadal normal rainfall data (1961-1990) were extracted using images generated by the Agro-Met Group (FAO/SDRN). Figure 3 of the Appendix presents a country-wide vegetation map which highlights the difference between 2004 end-of-season vegetation and the 5-year average for the same dekad; the deficit is clear in major maize growing areas of Mashonaland West and Central.

3.2.  Inputs

There were critical shortages of quality maize seed during the 2003/04 planting season. This year, according to National Early Warning Unit (NEWU) statistics and trade sources, only 13 000 tons of hybrid maize seed was available on the retail market. A further 7 998 tonnes was provided through Government Input Schemes, including 1 200 tonnes through the government-owned farming company, ARDA. In addition, FAO and various NGOs provided 6 366 tonnes of maize seed, bringing the total to 27 364 tonnes. This is sufficient, at 25kgs per hectare, to plant 1 094 560 ha of maize. Due to inflation and scarcity, the price of hybrid maize seed went up by nearly 1 000 percent from September 2002 to September, 2003. Some of this seed was planted in October and failed, forcing farmers to seek alternative sources of seed, including once-grown or even twice-grown hybrid seed. Hybrid seed is designed to be grown only once, but in 2003/04 season many farmers, facing the situation described above, planted once-grown or twice-grown hybrid seed. Unfortunately, the yield decline of twice-grown hybrid seed is very steep. Farmers also planted low-yielding local open-pollinated varieties. Considerable numbers of farmers, who could not obtain or afford quality seed, planted WFP maize this year, which also resulted in low yields. The shortage of seed this year was caused by poor seed crops last year and by high levels of pilfering prior to harvest.

In a survey carried out by ICRISAT, 80 percent of farmers reported difficulty in sourcing maize seed, with over 60 percent reporting difficulties in obtaining groundnut, cowpea and sorghum seed. As a result, over 40 percent of farmers reported that they planted less than they had intended. Considerable supplies of seed of maize, small grains, groundnut and cowpeas and other legume seeds were provided by FAO and a large number of NGOs, for a value of US$19.3 million, of which US$9.5 million was allocated to the provinces of Midlands and Masvingo. Total allocations of seed and fertilizer were: maize seed – 6 366 tonnes, as mentioned above, sorghum and millet seed – 3 670 tonnes, legume seed – 1 255 tonnes, vegetable seed – 33.1 tonnes, fertilizer 7 979 tonnes, mainly Ammonium Nitrate, with small quantities of basal fertilizer and organic fertilizers.

Agricultural credit amounting to Zim$5.5 billion was provided by the Land Bank which began operations in October, 2003, with a further Zim$150 billion being allocated for summer crops in 2004³. Against the total requirement, these allocations are small. Some further funds of Zim$407.15 billion and US$199.5 million were invested by 23 companies in contract farming, mainly tobacco production.

Fertilizer usage has fallen substantially over recent years, officially from 460 000 tonnes to 380 000 tonnes, comprising 220 000 tonnes of NPK and 160 000 tonnes of Ammonium Nitrate, but precise figures for in-country fertilizer usage are difficult to obtain. There is little doubt that considerable quantities of fertilizer are exported to neighbouring countries. With inflation running at 600 percent, the price of fertilizer is now well beyond the means of the average small farmer. The price of the basal NPK fertilizer increased by a factor of 20 in the year to September 2003, while the price of Ammonium Nitrate increased ten-fold during the same period. Soil fertility is declining fast as a result. In addition, soil pH levels in communal areas are very low, often too low to allow any response from applied phosphatic fertilizer. Responses to application of ammonium nitrate can still be spectacular, but this product is in short supply, especially in the more remote rural areas, and farmers do not have access to means of transport.

Supplies of draught power are also critically short. The District Development Fund (DDF) was reported to have 379 working tractors and a total of 26 435 ha were ploughed, disced or ridged. Set against total area planted to maize of 1.52 million ha, this is a negligible figure. The development of a competent and efficient private contracting service is highly desirable, but currently the cost of private contract work is reportedly too high for most poor farmers.

The general level of poverty has worked against the development of a private agricultural inputs business outside the major cities and towns. With no collateral, farmers of all types have to find working capital through sources other than the commercial banks (which used to focus on the large scale commercial sector). Privately owned input providers have seen a massive decline in their business since 2000. Orders for agricultural chemicals such as herbicides, insecticides and fungicides have declined by 73 percent according to sources in the trade. The government has tried to provide inputs, especially for A1 and A2 farmers, with the Ministry of Agriculture and Rural Development requesting an allocation of Zim$536.8 billion for its Inputs Scheme. In response to this request, only Zim$65 billion was allocated, with a further Zim$70 billion being provided later, mainly to cover inputs for the summer crops. In many cases the required inputs arrived too late or were of the wrong type. Basal fertilizer for maize was almost impossible to obtain and supplies of Ammonium Nitrate top-dressing were beyond the reach of communal and many small scale resettled (A1) farmers. Shortages of diesel for tractors and for irrigation pumps were also widely reported and these may limit wheat production for 2004. Shortages of electricity to pump water from dams may also limit wheat production this year.

Agricultural extension advice is not generally available to farmers. In a survey carried out by ICRISAT, over 60 percent of farmers reported having had no extension visits during the season. Agricultural skills are also rapidly eroding due to the tragic effects of HIV/AIDS.

3.3 Pests and diseases

Poor quality seed, lack of sufficient draught power resulting in late planting, erratic rainfall, lack of fertilizer and poor weed control had much more to do with reduced yields than did pests and diseases. However, damage by wild pigs, elephants and other wild animals were widely reported, especially on newly opened land. Maize streak virus also struck many areas in Mashonaland East, Central and West, the most important maize producing areas in the country. Rosette virus affected groundnut crops in many areas of the country, leading to low yields. Quelea and other birds damaged small grain crops in Matabeleland North and South.

Virus vectors such as aphids were not controlled due to lack of funds to buy pesticides. Late rains may damage sorghum and maize crops in Matabeleland North and South; they have already harmed groundnut crops in those areas.

3.4. Lack of labour and loss of agricultural skills

Small (A1) farmers can almost never afford hired labour, and those larger (A2) farmers who have money do not always pay the minimum wage to farm workers. One worker on an A2 farm reported to the Mission that he was paid Z$52 000 per month (US$10) compared to the minimum wage of Z$191 000 per month. This is a major cause of farm labour shortages throughout the country.

The incidence of HIV/AIDS in Zimbabwe is one of the highest in the world, with about one-third of the adult population affected. The Mission observed that there are many families supporting orphans and many female-headed or child-headed households as a result of HIV/AIDS deaths, now running at over 3 000 people per week. The high level of sickness reduces the availability and efficiency of labour for all agricultural operation, and leads to a loss of agricultural skills. According to NEWU, the effect of HIV/AIDS on agricultural productivity has not yet been investigated in a comprehensive way in Zimbabwe.

The large-scale displacement of around 400 000 skilled agricultural workers, replacing them with a much smaller number of small farmers with 5 ha plus some communal grazing land (A1) and larger farmers having from 40 ha to hundreds of hectares (A2 ) has reduced the number of people with the necessary skills and experience to manage and operate a farm effectively. Only 2 018 farm workers, or about 0.1 percent of farm workers got land in the reform programme.

3. 5. Harmful coping strategies

Instead of working in agriculture for very low wages, many farm workers have taken up panning for gold in the numerous streams and rivers. This digging has actually accelerated the silting up of dams used to irrigate high value crops such as flowers and vegetables; it is also likely to affect wheat grown on irrigated land in the winter. Irrigation infrastructure itself has been badly damaged by theft of pipes and brass fittings, some vital components being removed from large dams.

4. MAIN SEASON PRODUCTION ESTIMATES

Provincial maize production estimates are summarized in Table 1 below⁴; tables for sorghum, pearl millet and finger millet are in the Appendix. In addition, urban and peri-urban maize production are estimated at 25 000 tonnes, and added to the grand total.

Table 1. Estimates of Maize Production for 2002/03 and 2003/04 ( tonnes)

Note: Totals computed from unrounded data.

4.1. Winter crop production

An estimated 20 000 ha of wheat is expected to be planted this year, which with an average yield of 4 tonnes/ha, should yield 80 000 tonnes. But the amount planted depends on the availability of diesel fuel for tractors and on diesel and electricity for irrigation pumps. Most of the wheat will be grown on farms managed by ARDA, a parastatal agricultural company. Diesel shortages are limiting production on A2 farms having the necessary irrigation infrastructure, but the fact that wheat is a controlled crop also limits production. Water levels in large dams throughout the country, with the exception of the important Mazoe Dam, are higher than at the same period last year. However, as mentioned above, the irrigation infrastructure suffers from the theft of important components sold for scrap. Discussions with traders indicated that there is a stock of 8 000 tonnes of barley. Some land normally used for barley production may be planted to wheat, but this remains to be seen. Estimated cereal production, nationwide, is summarized in Section 5, Table 2: Cereal Supply/Demand Balance 2004/2005.

4.2. Livestock

Due to the late onset of the rains, many cattle in the dry provinces of Matabeleland South and North died from a combination of hunger and thirst. According to information provided to the authors during their field visits, Matabeleland South and North lost up to 20 000 and 5 000 head of livestock, respectively, during late 2003. This had the effect of impoverishing hundreds, if not thousands of families and comes on top of a reported 20 000 cattle deaths in the previous year’s drought in Matabeleland South. Grazing conditions have improved strongly since December, 2003. However, the practice of communal grazing, with no recognized upper limit on stock numbers, is leading to wide-scale land degradation and soil erosion in much of the country. Stock owners will eventually have to make provision for winter feeding or reduce numbers, but there is no incentive to do so under communal ownership.

The 2002 National Livestock Census showed a total of 5.05 million cattle, 0.642 million sheep, 3.4 million goats, 0.5 million donkeys and 0.18 million pigs. The Ministry of Agriculture and Rural Development estimates the national cattle herd now at 5.6 million head, down from 6.4 million in 2001. As a result of the land reforms, most pedigree herds have been de-registered, with a corresponding decline in productivity. Cattle bloodlines must be protected if the beef industry is to become viable again.

The outbreak of foot and mouth disease which began in 2001 is still uncontrolled, with the most affected areas being northern Masvingo and southern Manicaland. A total of 354 foci were reported nationally within the last year and 943 000 head were vaccinated. Vaccination is severely constrained by lack of foreign exchange for vaccines. It is estimated by the Ministry of Agriculture and Rural Development that US$25 million is needed for the outbreak to be ended and one donor has pledged US$8 million of this so far. Oxen affected by Foot and Mouth Disease cannot be used for draught purposes; this has further reduced the availability of draught power. This disastrous outbreak has also prevented the export of all ungulates and is a major blow to the economy, not just in Zimbabwe, but potentially in all neighbouring countries.

The National Association of Dairy Farmers reported 24 000 cows in milk, 6 000 dry cows, 8 000 in-calf heifers and 1 000 other heifers for the 2002 census. The number of dairy farms has reduced from 437 in 1995 to 295 in 2003, with a concomitant drop in milk production from 253 million litres in 1991 to 140 million litres in 2003. National requirements are estimated at 300 million litres. Milk production has dropped by 40 percent according to recent media reports, with low earnings being a major causal factor. The Ministry of Agriculture and Rural Development reported that every dollar invested in dairy farming now only provides a loss-making return of $0.85. Nutrition of cows is reported to be sub-optimal on many A2 farms, with cows having calving difficulties and high incidence of retained afterbirths. As a result, milk supplies are erratic at best. Tick-borne diseases such as heartwater and bovine babesiosis continue to cause losses in the absence of effective dipping systems. Farmers pay Zim$600 per animal in cost recovery for dipping services, but this is no longer sufficient to purchase the acaricides and to maintain dipping facilities: the high rate of inflation has sharply reduced the value of the budget of the Livestock Department of the Ministry of Agriculture and Rural Development.

Pig and poultry production are becoming large-scale enterprises with a few main producers. Back-yard poultry are still an important source of livelihood for rural women. This year there were few outbreaks of Newcastle Disease.

5. CEREAL SUPPLY/DEMAND BALANCE, (APRIL/MARCH)

Zimbabwe’s cereal supply/demand balance sheet for the 2004/05 marketing year (April/March) is shown in Table 2 below. It is based on the cereal production estimates shown in Table 1 and A.1 to A.4, and on the following estimates and assumptions:

• The Population Census of 2002 puts the population of Zimbabwe at 11.635 million as of 18 August 2002 growing at 1.1 percent per annum. The population figure used in last year’s CFSAM was, on that basis, 11.77 million. Similarly, in mid-2004/05 marketing year the population works out to be nearly 11.90 million.

• The stock of maize held by the Government at the beginning of the current marketing year (end of March) was believed to be 60 000 tonnes . Privately-held maize stocks cannot be much given last year’s low production, and are assumed to be about 10 000 tonnes plus 5 000 tonnes of sorghum and millet. WFP and NGO food aid stocks amount to 60 000 tonnes. In the case of wheat, the total opening stocks are assumed at 30 000 tonnes.

• Per caput cereal consumption of 163 kg per annum is, as used in past CFSAMs, distributed across cereals as follows: maize 120 kg; wheat 29 kg; millet and sorghum 13 kg; and rice 1 kg. At 163 kg of cereals per caput/annum, about 70-75 percent of the minimum daily calorie needs of 2100kcal would be met from the cereals, on average. The remainder is expected to come from other foods such as beans, groundnuts, root crops, meat, poultry, fish, vegetables and wild foods.

• Use of cereals for animal feed is likely to be limited, given the large and widespread shortages of grains. Moreover, livestock numbers, especially of dairy cows and quality beef cattle, have declined, significantly in certain districts. Thus, the quantity of maize to be used as feed is estimated at about 125 000 tonnes, slightly lower than last year.

• Hybrid maize seeds purchased from seed suppliers and supplied by the Grain Marketing Board (GMB) are used almost universally in Zimbabwe. Hence, little maize is normally set aside for seed. However, in view of likely limited availability of hybrid seeds in the coming year, farmers may be expected to set aside certain quantities of maize for seed. With a projected planted area next season of 1.4 million hectares and assuming that in certain areas replantings would be necessary, a total of 30 000 tonnes is assumed to be set aside for seed. Losses are assumed at 10 percent of production, or 71 000 tonnes of maize. For other grains, 10 percent losses and small quantities for seed and other uses are assumed.

• A strategic closing stock of 120 000 tonnes of maize, sufficient for the national need for a month, is assumed. In the case of wheat, the closing stock is assumed to be 30 000 tonnes, again about one months’ supply.

Table 2. Cereal Supply/Demand Balance, April 2004/March 2005 (tonnes) 1/

1/ Barley production is not included in this balance sheet since most of it is used for commercial brewing purposes.

• The government of Zimbabwe imported substantial quantities of foodgrains during 2003/04, of which about 220 000 tonnes is to be delivered during the current marketing year. The new monetary policy of strict regulation of foreign exchange transactions introduced earlier this year through a mechanism of controlled auctions, increased cotton production and higher tobacco prices have improved the Government’s foreign exchange position. It is assumed that another 400 000 tonnes of maize will be commercially imported; in addition the deficits of about 276 000 tonnes of wheat and nearly 9 000 tonnes of rice are expected to be covered by commercial imports. Restrictions on private sector maize imports were eased to some extent in February 2003. If still in force, these should enable the private sector to contribute to food imports. Given relatively good maize production in Zambia and Mozambique this year, substantial cross-border inflows are likely to occur, helping reduce the uncovered deficit.

APPENDIX

Figure 1. Graphical Representation of 2003/04 Rainfall at ten stations compared to the previous season and to the long term average rainfall.⁵

Figure 2. Zimbabwe - Growing Season Interpolated Estimated Rainfall Cumulative Rainfall (mm) for Mashonaland Central, Mashonaland East, and Mashonaland West, October 2003 to April 2004.

Figure 3. Difference Vegetation Map for Major Maize Growing Areas; 2004 vs. 5-year Average

Figure 4.

Table A.1: Sorghum Area, Yield and Production by Province, 2003/04

Table A.2: Pearl Millet Area, Yield and Production by Province, 2003/04

Table A.3: Finger Millet Area, Yield and Production by Province, 2003/04

Table A.4: Wheat and Barley Area, Yield and Production for 1999-2003 and forecast for 2004⁶

1. Some independent observers reckon it could be much more.

2. This section is based published and unpublished reports of the UN System, the Monetary Policy Statement for the First Quarter of 2004, issued by the Governor of the Reserve Bank of Zimbabwe, the Country Profile of Zimbabwe by the Economist Intelligence Unit, and other sources.

3. As reported by the SADC NEWU.

4. Area planted data for maize, sorghum and millet are from the Ministry of Agriculture and Rural Development Crop Weekly Report for the week ending 23 April, 2004.

5. Source: Department of Meteorological Services, P. O. Box BE150, Belvedere, Harare.

6. Source: Zimbabwe Cereals Producers Association; 2003 and 2004 area and yield forecasts by the authors.