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Tongaat Hulett Suspends Advance Cane Payments To Farmers

Tongaat Hulett Suspends Advance Cane Payments To Farmers

Sugar processor Tongaat Hulett has informed sugarcane millers that the company is unable to pay for their produce in advance after the Government banned bank lending.

Economic commentators have warned that the ban will have negative repercussions on the economy as firms rely on bank credit to fund their operations.

In a notice to sugarcane farmers on Thursday, 12 May 2022, Tongaat Hulett COO James Bowmaker, said:

It is with regret that the millers advise of the immediate suspension of advance payments until further notice.

We normally fund the advances from loan proceeds that we access from the banks.

Following the recent suspension of lending by banks, we find ourselves unable to continue offering advances.

Meanwhile, Finance and Economic Development Minister Mthuli Ncube said the ban on bank lending is aimed at combating indiscipline in the financial services sector driving inflation and weakening the local currency. He said:

Indiscipline is something that we need to deal with and we will make sure that we enforce the measures that we have put in place to deal with this indiscipline.

These are temporary measures, what we are trying to do is to prick the speculative bubble, which has emerged in the forex market as well as in the equities market.

As I said, it (the ban on bank lending) is temporary and we will get to a point where we can loosen up and open up.

More: Pindula News

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Jah­čç┐­čç╝Tsvarie-07 1┬ámonth ago

Another Russia on Zimbabwean Citizens
TORINGEPI nema experiment e RBZ...

Chawabvunza 1 month ago

It is understandable that Tongaat Hulett has been financing its advance payment from bank borrowings.


Mmmm 1 month ago

The "Prick" has popped the "open for business" bubble.... let the show begin.

gmb foreman 1 month ago

Farmers in Midlands Province have rejected the new Grain Marketing Board (GMB) grain prices that were announced by the government last week.
Farmers who spoke to Southern Eye said that the prices do not allow them to break even and they would rather sell their maize to the highest bidders.
Last month the Government announced an upward review of the floor producer prices of maize, soya beans, traditional grains and sunflower.
The producer price for maize and traditional grains was raised to ZWL$75 000 per tonne.
Previously, the floor producer price of maize was ZWL$58 553 while that of traditional grains was ZWL$70 263.90.
In US dollar terms, the new price of grain is around US$180 using black market rates.
Herbert Choruma, a Gokwe farmer said the Government should consider paying farmers for their produce in foreign currency. He said:
The producer prices should be pegged in US dollar because our local currency is not stable.
Another farmer Sheila Muronziwa said the Government cannot expect farmers to deliver their grain to GMB considering the ÔÇťuncompetitiveÔÇŁ prices on offer. Said Muronziwa:
The maize and traditional grains producer prices of $75 000 per metric tonne by GMB are uncompetitive.
We are now contemplating on selling our produce on the black market.
Government cannot expect farmers to produce when it is paying such low prices for grain. The production chain will be hamstrung.
Farmers claim that it costs US$100 to prepare a hectare of land and two applications of herbicides also cost US$100. Kwekwe farmer Misheck Shumba said:
That farmer also requires labour to remove weeds and tender the crops. Farmers are simply going to sell their produce to the highest bidder.
Meanwhile, the GMB recently said all maize, soya beans, wheat and barley farmers should deliver their produce to any nearest GMB depot within 14 days of harvesting.
GMB also warned that those who ignore the directive risk prosecution as well as losing their produce.
More: NewsDay

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