Seed maker Du Pont Pioneer closes $2mln project over high water tariffs

Seed maker Du Pont Pioneer closes $2mln project over high water tariffs

HARARE, November 22 (The Source) – Seed maker Du Pont Pioneer says high water tariffs forced the closure of its $2 million irrigation project in eastern Zimbabwe after two years of operation, and dropped its exports by two thirds, an official said on Tuesday.

Country Manager Temba Nkatazo on Tuesday told the parliamentary committee on lands, agriculture, mechanisation and irrigation that the Chipangayi Sugar Bean Irrigation project was set up in 2014 but was shut down at the end of 2015 after the seed producer failed to negotiate lower water tariffs with the Zimbabwe National Water Authority (Zinwa).

Members of the committee toured the firm’s plant in Harare.

“It was a viable project as there is high demand for sugar beans internationally. We could produce 2,000 tonnes per season but water was too expensive for us to keep that operation going. We were paying between $9,000 and $10,000 a month,” he said.   

The sugar bean seed, worth between $3 million to $4 million per season, was mainly exported to South Africa, Mozambique, Malawi and Zambia.

Nkatazo said the closure of the project contributed to a sharp decline in the company’s seed export to between 800 tonnes and 1,000 tonnes per season from about 3,000 tonnes.

Du Pont Pioneer’s share of the local market is 10 percent. This year, the company produced 3,500 tonnes of maize seed for the local market, Nkatazo said, while 1,000 tonnes were  exported to Cameroon and 500 tonnes to Mozambique.

“From 1980 Zimbabwe was one of the top manufacturers of seed because of our climate. We were producing seed for Tanzania, Ethiopia and the whole of East Africa ….but international firms moved into that space when government banned seed exports so it is now difficult to focus on the export market,” said Nkatazo.

Zimbabwe requires between 35,000 and 40,000 tonnes of maize seed per season and government has previously banned seed exports to allow adequate supplies to the local market.