Relief for cotton farmers as Cottco clears US$21 million debt

The Cotton Company of Zimbabwe (Cottco) has settled off US$21 million outstanding payments to farmers, the company has said.

However, despite repeated mobile money notifications, over US$323 000 remains uncollected, raising concerns for farmers facing drought and financial hardship.

“This delay in voucher redemption is a cause for concern particularly in this drought year where farmers require financial resources to ensure food security,” Cottco said.

Cottco is the country’s largest cotton financier, supporting about 300 000 smallholder farmers through the Presidential Free Inputs Scheme.

Under the scheme, farmers are provided with free inputs including seed, fertilisers and chemicals.

The breakdown of uncollected funds reveals a significant number of outstanding payments across all provinces. A total of 3 741 farmers across all provinces are yet to collect their payments, amounting to US$323 642.

The provinces with the most outstanding payments are Mashonaland West (830 farmers for US$82 384), Masvingo (892 farmers for US$82 978), and Manicaland (633 farmers for US$53 392).

“These payments were disbursed to farmers via mobile money platforms as vouchers,” Cottco said. “Farmers are encouraged to visit business units or designated collection points promptly to access their hard-earned payments.

Zimbabwe is grappling with drought induced by El Niño, which has significantly affected agricultural yields across the country, including cotton.

Farmer organisations haven’t released final estimates, but initial indications suggest a substantial decrease in cotton production compared to last year. Some indications even suggest this could be the industry’s worst season in years.

The drought has severely impacted cotton farmers, with some expecting a quarter of their usual harvest. In the worst-case scenario, some might not be able to harvest any cotton at all.

At its peak, during the 2010/11 season, Zimbabwe produced a staggering 352 million kilograms of cotton.

This was a banner year for the cotton industry, and it placed Zimbabwe among Africa’s leading cotton producers.-ebusinessweekly