Mealie Meal Crisis: panicking PF forces Food Reserve Agency to sale at a loss

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The Zambian government is panicking over the mealie meal crisis and has forced the Food Reserve Agency to sell maize at K60, 000 instead of K65, 000 or more per 50 kg bag in a bid to try and control sky-rocketting prices.

The cost of a bag of 25 kg mealie meal jumped K45, 000 to between K75, 000 and K80, 000 on the Copperbelt after a shortage in the commodity which is a staple food for Zambia.

In an attempt to bring the situation under control, the government says its decision to allow the Food Reserve Agency to sell the maize it bought at K65, 000 per 50kg to millers at K60, 000 is aimed at ensuring Zambians have access to reasonably priced mealie meal.

Qfm reports that Agriculture minister Emmanuel Chenda says government remains committed to ensuring that the country’s staple food is made available to all the domestic consumers in the country for enhanced food security.

Chenda said the government will therefore ensure that it makes realistic rather than economic decisions at the expense of the ordinary Zambians.

FRA has announced that it will in the first week of December start selling maize to millers at K60, 000 per 50kg bag.

This comes in the wake of mealie meal shortages which hit some parts of the country recently with Kitwe and Chingola being the worst hit.

Comments Closed

56 Responses to Mealie Meal Crisis: panicking PF forces Food Reserve Agency to sale at a loss

  1. Why are you people banging your heads on the wall? PF and FRA sold maize worth 51 million to zimbabawe in july 2012, while a lot of meali-mill is being sold to Congo by top PF members who are making a big killing.

    Open your eyes guys, otherwise you will starve!

    Wanzelu - November 30, 2012
    19:24

    • Nobody’s hanging their heads here. We just suppose we want to avoid the sort of emotional reactions that got us here in the first place. You see we’re trying to understand the source of the problem before we can formulate a possible solution. Of course this discussion is inconsequential, but it beats watching porn.

      Sumerian - November 30, 2012
      21:36

  2. At least there are less insults and better analysis on this issue.keep it up.this is progressive and educative.hope the situation stabilizes so that people can eat what they enjoy most among the many choices.

    grace - November 30, 2012
    18:45

  3. 5. (1) There shall be a national strategic food reserve which shall, subject to this Act, be administered by the Agency.
    National strategic food reserve
    (2) The purpose of the national strategic food reserve shall be to-
    (a) ensure a reliable supply of designated agricultural commodities for the country;
    (b) meet local shortfalls in the supply of a designated agricultural commodity;
    (c) meet such other food emergencies caused by drought or flood, or by such other natural disaster, for the purposes of this Act, as may be declared by the President;
    (d) correct problems relating to the supply of designated agricultural commodities which result from the manipulation of prices or monopolistic trading practices.
    (As amended by Act No. 20 of 2005)
    6. (1) The Minister shall designate, prior to October 31st of each year, any cereal, oilseed, stockfeed and any other agricultural food commodity that he considers essential for the food security of the country.
    Designation of commodities
    (2) In the case of the marketing season in which this Act comes into force, the Minister shall make the designation referred to in subsection (1), not later than thirty days after the coming into force of this Act.
    7. (1) Subject to subsection (2), the Agency may purchase from the domestic market or import any designated agricultural commodity for the purposes of the national strategic food reserve.
    Purchase and importation of designated agricultural commodities
    (2) The Agency shall not purchase any designated agricultural commodity unless it announces in the Gazette and the print media, prior to the 1st of May of each year, its plan for purchases of each designated commodity in the following marketing year.
    (3) The plan referred to in subsection (2) shall include the-
    (a) quantity of the designated agricultural commodity the Agency plans to purchase;
    (b) method of procurement and payment for the designated agricultural commodity by the Agency; and
    (c) places at which the Agency plans to make such purchases.
    (4) The Agency shall announce and publish in the Gazette and the print media prior to the 31st of October of each year, the procedure to be followed in buying a designated agricultural commodity which it needs to import or when buying locally for the next twelve months; and different procedures may be published for different areas.
    (As amended by Act No. 20 of 2005)

    8. (1) Subject to subsection (2), the Agency may sell any designated agricultural commodity in the national strategic food reserve to meet-
    Sale of designated agricultural commodities
    (a) local shortfalls in the supply of the commodity;
    (b) other food emergencies caused by drought, flood, or other natural disaster.
    (2) Subject to subsection (3), the Agency shall not sell any designated agricultural commodity in the national strategic food reserve unless it publishes in the Gazette and in the print media, prior to the 31st of October of each year, the procedure to be followed during the following twelve months in selling any designated agricultural commodity held in the national strategic food reserve; and different procedures may be published for different areas.
    (3) Whenever a designated agricultural commodity is stored as part of the national strategic food reserve, the Agency may sell, quantities of the designated agricultural commodity in different places to the extent necessary to properly handle, rotate, distribute, and position the designated agricultural commodity as part of the national strategic food reserve.
    (4) Subject to subsection (3) any purchase to offset a sale of a designated agricultural commodity shall be made as soon as possible following the sale.
    (As amended by Act No. 20 of 2005)

    9. The Agency may receive any designated agricultural commodity or any commodity not designated under this Act as part of the national strategic food reserve donated by any person, body, Government or institution:
    Receipt of designated agricultural commodity and non-designated agricultural commodity
    Provided that the Agency may sell any commodity not designated under this Act as a designated agricultural commodity and shall purchase quantities of the designated agricultural commodity to properly rotate, distribute and position the designated agricultural commodity as part of the national strategic food reserve.
    (As amended by Act No. 20 of 2005)

    Atas - November 30, 2012
    18:39

  4. Planning of what, exactly? I mean as far as I know, FRA buys maize from farmers/agents, millers buy from FRA (for the most part). The demand for mealie meal in Zambia is constant, more or less so you’d expect a constant flow of maize between FRA and millers, and therefore a constant supply of mealie meal, and FRA has not run out of maize. So I don’t understand where and how the problem occurred. Of course there’s no denying the problem, but it’s difficult for me really to how the government is at fault. Did they somehow tamper with the maize supply to the millers perhaps? I’m inclined to believe there might something to the allegation of collusion amongst the millers here.

    Sumerian - November 30, 2012
    17:22

    • Rightly said- I think you are spot on.
      I too cant understand;

      The demand for finished product (m/meal)is high, and the manufacturers (mealers)are available. Why the critical shortage?

      And then why should the provider of raw material sell at a loss in this case? Naturally the mealers should be begging the FRA to supply maize, and not FRA begging them to buy.

      What really is going on here?

      Atas - November 30, 2012
      17:48

    • FRA is a Semi-Autonomous Parastatal whose Board reports to Ministry of Agriculture/ Livestock. It has a Market Intelligence Unit (MIU) whose Function is to monitor Maize Stock Levels held by Millers. Therefore FRA should know when Millers Stock Levels are low so that it intervenes on the Market to stabilize Maize prices & by extension Maize Meal prices. The shortage of Mealie Meal is a Corporate Governance problem as Maize is available in the Country.

      Bishop Aringarosa - November 30, 2012
      18:43

  5. more money in your pockets yeah right….whats happening is not surprising sata cant lead a country illiteracy in this country is serious because how could people vote for a man like sata to be president he is clearly not presidential material

    Likman666 - November 30, 2012
    17:14

  6. From Satanic accidents then to power blackouts then to water shoratges then to mealiemeal shortages then to airtime shortages! What a govt!!!!!!!!!!!!!!!!

    Patriotic Observer - November 30, 2012
    16:53

  7. My comment is awaiting moderation. So you just post comments in favour of your story? Okey nowonder we always see pro comments but this will not take you anywhere. You should allow people to criticise you the same way you criticise govt and post news paper.

    calculas - November 30, 2012
    14:32

    • Go and read your compromised tabloid

      CHAMBA FODYA GWAYI - November 30, 2012
      15:19

      • Is your online tabloid not compromised by HH and group?

        Kalu - November 30, 2012
        18:16

    • But this is critic and we are seeing it Boy or Girl

      Bull - November 30, 2012
      16:08

  8. If FRA has had maize all this time, then why do we have a shortage of mealie meal? Initially I thought there was a SHORTAGE of maize in the country, but apparently there’s none. So how exactly did the crisis begin?!

    Sumerian - November 30, 2012
    14:02

    • If we plenty of maize but no mealie meal then it is due to simple lack of planning on the part of the government. Can you think of any other reason?

      Liminabanganga - November 30, 2012
      14:12

  9. This blog is full of childish and foolish reportage which is punctuated by wild and unresearched commentaries from uncircumcised primitive bloggers who see nothing good in the PF government. The availability or shortage of mealie meal is a matter of life and death. A concerned and caring government will always provide contingency rations when people’s food stocks run out and suppliers become dry. This is exactly what the PF government is doing. The Food Reserve Agency is a strategic institution which stocks reserves of corn (maize). In times of Plenty for every household, the FRA is teeming with huge stocks of maize which are supposed to be well protected. Some revenue is brought into the country by exporting some surplus from reserve stocks But when the the ugly head of food crisis haunts households, it is the obligation of the government to offload some grain from the reserve store onto the millers so that food is made available to the masses. I’m not surprised by this hostile article because this blog and its proprietors have seen an opportunity to blame the government and in a false hope they think food crises can create instability and food riots which can spur them onto the platform of state power. It never works like that. Zambians have become more politically enlightened and are able to distinguish between substantial issues and nonsense.

    Ngai - November 30, 2012
    13:54

    • Whatever Punk! No good will ever come out of PF. They are a bunch of simpletons who can not tell the left from right. Only a crazy person can see progress in PF so far. These guys have failed to govern this nation. We on kamulyaweka time. Maimwene time.

      Bullman - November 30, 2012
      16:29

    • Great reasoning there.

      But sir, if we have enough adequate stores of maize and even some to export, why the local shortage of meali meal?

      Atas - November 30, 2012
      17:55

      • Millers dont want to buy maize from farmers.They are used to buying maize from FRA at K40,000 per bag.Infact,PF has done even better by selling at K60,000.FRA was suppose to start selling their maize next year but has started selling this year due to pressure.Millers blackmailed the govt,they are used to be buying at 40pin and have been buying at this price for the past 4 years or so.

        Kalu - November 30, 2012
        18:13

  10. Well and good for millers,worse for govt.nowonder they are failing to pay farmers,

    MR KISS - November 30, 2012
    12:30

  11. Ukwa will be ‘VERY SURPRISED’ when FRA makes a loss.

    Lwalwa - November 30, 2012
    11:44

  12. The FRA Maize purchase price has averaged @ $240/MT taking into account volatility in Exchange Rate. Add Storage, Security, Labour, Fumigation, Insurance (Handling Fee) We should arrive at an Equilibrium price of $300/MT. Maize (Corn) is trading @ $336/MT at the International Grain Council (IGC) as 29/11/12. FRA has released for sale the Maize @ $224/MT, incurring a direct loss of $76/MT & indirect loss of $112/MT. We need to question the sustainability of this whole Maize Marketing Exercise.

    Bishop Aringarosa - November 30, 2012
    10:35

    • Now is the type of analysis PF is lacking. Grade 2′s can never think like this.

      Bullman - November 30, 2012
      16:31

  13. Better u sell at a give away price than leaving the stock to rot. Well done govt.

    Calvin Machila - November 30, 2012
    10:01

    • Now this is crowning foolish/stupid decisions.

      Bullman - November 30, 2012
      16:33

    • But why would it rot in the first place?

      They buy (or borrow) maize from farmers and they (GRZ) can not even manage to store? That would be irresponsible of anyone, let alone if the monies involved are taxpayers’.

      Atas - November 30, 2012
      18:02

  14. What is wrong with FRA coming in to regulate the M/meal prices and curb the shortage? I thought that was the reason it was created?

    Lusaka boy - November 30, 2012
    09:37

    • Read the FRA act don’t expose your ignorance punk.

      Bullman - November 30, 2012
      16:34

  15. Where is the proffesor, Bwana minister swallow your pride we millers still believe that the proffessor was the right man for fra you should have tried him for that job that is what he was doing in S Africa for the past 20 years, look for him even if it will be just consulting you need his ideas. Twalafya insala under this try and error arrangement

    Mpundu Mulenga - November 30, 2012
    09:18

  16. in year of the great king Atas…..wait n see….brace yoselves

    in the year of king Atas - November 30, 2012
    09:15

  17. CNP

    CHIPS2016HH - November 30, 2012
    09:05

    • I concur CNP at work

      Bullman - November 30, 2012
      16:35

  18. Why is the shortage of maize flour such a big deal? Is maize flour the only food that we, as Zambians, can think of as a staple? As far as I am aware, maize is not even indigenous to Africa. It was domesticated in the Americas and is just one of those foods that were introduced to Africa not so long ago. But the irony is we have become so hooked on this grain that any slight disruption in supply sends people in a panic mode spending so much time and energy just searching for maize flour as if there are no suitable and affordable alternatives to think of. What were people eating prior to the advent of maize? What about sorghum, cassava, sweet potatoes, plantains (bananas), Irish potatoes etc.? Can these not be eaten or consumed in the exactly the same way we consume maize flour? If we do not think out of the box, we will perpetually subject ourselves to misery in the midst of plenty. Recall the proverbial saying “in the abundance of water a fool will go thirsty”.
    To improve food security, the govt through the Ministry of Agriculture should, as a matter of priority, identify areas around the country where these various foodstuffs would grow well and encourage small-scale farmers to diversify the agricultural sector. It is sickening to always talk about maize shortages as if, with all the technological advances in agriculture at our disposal, it is the only edible crop that can be grown Zambia.

    Turnerac - November 30, 2012
    08:45

    • sickening

      sosa - November 30, 2012
      09:29

    • Pseudo-intelligence, trying to argue against himself.

      He calls maize a staple then starts questioning why its so important in a vanity fashion, what a waste of space!

      Lwalwa - November 30, 2012
      11:43

  19. This is the reason FRA was created. to regulate prices. so i see no problem. unless the writer of this article has another suggestion on how the gvt thru FRA needed to respond

    jinks - November 30, 2012
    08:43

    • FRA was not created to regulate prices please. Do people read?

      Yobaba - November 30, 2012
      08:45

      • nope they dont

        bill clinton - November 30, 2012
        08:56

      • FRA was created in the interest of food security i.e. buy maize to protect farmers from low prices and offload it when prices go up please read on the history of NAMBOARD which changed to FRA

        jinks - November 30, 2012
        08:57

        • But should they make a loss in the process? I dont think so SIR

          Atas - November 30, 2012
          18:08

      • Read the 2005 FRA ACT (Amended) & don’t post comments from an ignorant perspective. The revised FRA ACT gives the Agency Market Facilitation Functions. Put simply, the ACT empowers it to procure, store & supply Grain on the Open Market. FRA plays a stabilization role for Maize Prices & by-products in deficit & surplus Seasons. This is a regulatory role!

        Prof Langdon - November 30, 2012
        09:03

        • I think we are speeking the same language dear. I used the word regulate and you are using the word stabilization. buy buying from farmers FRA ensures that prices do not go too low to negatively affect farmers, and by offloading onto the market FRA ensures that prices do not go too high to negatively affect consumers. in the current situation prices are going up so what should FRA do even using the Amended Act you are citing???

          jinks - November 30, 2012
          09:11

          • @Jinks my comments where directed @Yobaba, the ignoramus. What should FRA do under the prevailing scenario? The Agency has adequate Grain Reserve in its Depots, assuming Export Orders were not over-commited. What is required is to make this Stock available where it is most needed i.e. Deficit Zones. That way supply & demand forces will interact until Mealie Prices reach Equilibrium.

            Prof Langdon - November 30, 2012
            09:45

        • FRA was creatd to be “the buyer of the last resort.” That role means they should only buy grain for the Strategic Food Reserve. But over time, they seem to asume that it is their role to buy every farmers grain. No. On regulation, FRA can even sell the maize at K10,000 per 50kg to the millers but millers are under no legal obligation to reduce mealie-meal prices. FRA does not regulate the price. They just seek to influence by offloading their stock on the market. Epela.

          Kabutu - November 30, 2012
          09:31

          • You are quoting the defunct 1995 FRA ACT which has since been replaced by the 2005 FRA ACT. In the original act FRA was a “Buyer of Last Resort”. In the 2005 ACT, FRA is ” Buyer of First Resort” which in effect is Market inteference! If the setting of Maize Prices of K65000/50Kg Bag of the last odd years is not regulation then what is it?

            Prof Langdon - November 30, 2012
            10:03

      • DON’ T WORRY BROTHER, U ARE DEALING WITH PEOPLE WHOSE EDUCATIONAL BACKGROUNDS ARE QUESTIONABLE. JUST LEAVE THEM TO EXPOSE THEIR IGNORANCE FURTHER SO THE PUBLIC SHALL FINALLY KNOW WHAT TYPE OF CHARACTERS THEY ARE DEALING WITH – ABSOLUTE FOOLS.

        Alexander Haig - November 30, 2012
        09:14

      • No they don’t my dear. That’s why we do not have intelligent analysis on blogs, just ignorance and insults.

        Kabutu - November 30, 2012
        09:26

        • But one of the reasons we all read (this includes reading ZWD) is to enlighten our selves and be able to analyse issues intelligently,
          Thank – you Prof. Langton ,I’ve personally leant something from you.

          Topclamp - November 30, 2012
          11:26

          • @Topclamp you are welcome.

            Prof Langdon - November 30, 2012
            12:18

    • You don’t need a PHD to understand what FRA is or what it does. Food (F)= Suitable for eating: Reserve (R)= To set aside, to Preserve, to store, to keep: Agency (A)= Organisation, society, group etc… it is as simple as that.

      G7 - November 30, 2012
      12:20

      • Granted. So if you were CEO of FRA what would you attribute the current Mealie Meal crisis to & what interventions would you undertake with the G7 level of Education?

        Prof Langdon - November 30, 2012
        13:10

        • Though your question Prof Langdon sounds hard and you seem a very Educated Man. I would attribute the current situation to lack of planning on the part of our Government and our millers. Our millers have no enough storage capacity (maize storage), they need a daily/constant supply of maize. If there is no one to supply the Millers with Maize for 1 day then we have a shortage of mealie meal as we are experiencing now.

          G7 - November 30, 2012
          15:05

        • with my G7, I would say the Millers have no grain storage capacity. They need a daily supply of maize which is very bad, that is why if nobody supplies them with maize for 1 day, then there is a shortage of mealie meal in the Country.
          Our Government should encourage the Millers to construct big storages for maize, so that even if FRA delays to sale them maize, they don’t get affected. Prof. Langdon, you seem very Educated and well informed!

          G7 - November 30, 2012
          15:30

        • with my G7, I would say the Millers have no grain storage capacity. They need a daily supply of maize which is very bad, that is why if nobody supplies them with maize for 1 day, then there is a shortage of mealie meal in the Country.
          Our Government should encourage the Millers to construct big storages for maize, so that even if FRA delays to sale them maize, they don’t get affected. Prof. Langdon, you seem very Educated and well informed!!!

          G7 - November 30, 2012
          15:31

  20. Why panic ba Paya Farmer? This government has failed in less than two years in power. RB was far much better.

    Kwa Muntonyo - November 30, 2012
    08:43

    • RB was buying at K65,000 and selling at K40,000.

      Kalu - November 30, 2012
      17:56