National Foods targets 5 000 hectares for winter wheat

WHEAT production in the country is set to rise compared to previous years, as one of the leading food manufacturers, National Foods is planning to contract farmers to plant more than 5 000 hectares.

The listed company’s target was to surpass the winter wheat harvests of preceding seasons, backed by the bountiful rains that increased dam levels countrywide. Farmers rely on irrigation to cultivate the cereal, as there is no rain during winter.

“National Foods will again support local wheat contract farming, with target plantings set at 5 300 hectares,” said National Foods secretary Mr Leigh Howes in its latest trading update last week.

The food manufacturer said it was banking on that farmers to be contracted will have adequately tilled their land. With Zesa having reportedly committed to 100 megawatts of power to winter cropping, optimism is relatively high.

In previous years, winter wheat cropping was dampened by power outages that affected production. But, this year, Energy and Power Development Minister Zhemu Soda has assured farmers that there will be an uninterrupted supply of power.

“Turning to wheat, while the local crop is currently being planted the early indications are for a much-improved wheat harvest based on improved dam levels, better preparation and substantially reduced power outages,” said Mr Howes in the statement.

He said from the period of plantation to harvest, there was going to be a need for imports to sustain market demand.

“The 2021 local wheat will be delivered in October or November, and wheat imports will be required until this point to supplement the remaining stock from the 2020 harvest.”

The company, which manufactures a range of food products recorded a substantial performance in some of its brand portfolios from January to March this year. While maize-based products are set to shoot up in volumes owing to a good harvest, the company spelt out that in 2020, its maize division hit a low.

“Volumes for the year to date at 395 000 tonnes have increased by 14,2 percent compared to last year and by 47 percent excluding maize. The maize division has had a difficult year. This has largely been due to the substantial volumes of maize meal imports from South Africa, particularly into the south of the country. These imports have subdued volume performance and impacted margins,” said Mr Howes.

An increase in the number of farmers that do poultry and the high demand for protein products was said to have made way for a 27 percent rise in stockfeed volumes.

“Stockfeed volumes increased by 27 percent driven by increased demand for protein products, notably in the poultry segment. The most recent quarter saw growth slowing as demand for beef feed declined on the back of improved pastures.”

In the flour department, a record increase of 46 percent was noted, in what the company attributed to the sustained stable foreign currency auction system.

“The groceries division sustained its growth trend, with a year-to-date volume growth of 95 percent driven largely by rice and salt. The snacks and treats unit saw volume increase of 44 percent for the year to date. This result was encouraging in view of the fact that the Covid-19 related movement restrictions have dampened demand in these categories.”

However, while National Foods places a positive view to its business growth this year, it remained cognisant that the plenty harvests by households in the last cropping season are likely to lower consumer spending power on maize products.-herald.cl.zw