Mozambique: Producers receiving subsidy to the price of cotton – Carta

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Mozambique: Producers receiving subsidy to the price of cotton – Carta

3:04 CAT | 17 Sep 2020

Francisco dos Santos, the president of the Mozambique Cotton Association, told ‘Carta de Moçambique’ on Tuesday that the 240 million meticais subsidy for seed cotton was already benefiting sector farmers.

“State disbursements have been proceeding as planned, gradually, as the commercialisation process progresses. Just last week, the sub-sector had a meeting [chaired by the Minister of Agriculture and Rural Development, Celso Correia], where this was verified,” Dos Santos informed ‘Carta’ by email.

The president of AAM explained that the subsidy has been delivered in full to the producers, without any diversion or waste, with the impact on farmers and their families extraordinary.

“Despite the fact that it was a very difficult year for all crops (due to the lack of rain in March), the economic loss was mitigated. Producers are very motivated and we expect great production growth next year. Seed distribution has already started, with huge take-up. For the aforementioned meteorological reasons, I think [expenditure] will be around 20% below estimates,” Dos Santos said.

Without this subsidy, the price of cotton per kilogram would be between 18 to 19 meticais (against the current 25 meticais), well below last season’s 23 meticais, due to the depreciation of prices in the international market as a result of Covid-19.

Reacting to the announcement of the subsidy by Minister Celso Correia on 12 May last, Dos Santos applauded the aid as being “a historic landmark in national agrarian and economic policy, and a real and indisputable sign of the government’s serious commitment to agriculture and the rural population. It is not a subsidy for consumption, but for production and for producing families”.

With the subsidy, AAM also underlined that, in the present 2020/21 campaign, , there will be even more producers, motivated and to produce more cotton, thereby predicting an increase in the value of exports by at least 12 million USD (more than three times the grant amount).

Data from the Ministry of Agriculture and Rural Development indicate that the cotton subsector generates between 30 and 40 million USD per year, with more than 200 thousand producers across the country and benefits more than one million people in the countryside.

By Evaristo Chilingue

Source: Carta de Moçambique