HomeBusiness DigestImports boosted wheat volumes, says Natfoods

Imports boosted wheat volumes, says Natfoods

NATIONAL Foods Holdings Ltd (Natfoods) says the limited availability of wheat last year had to be supplemented with imports to maintain sufficient volumes in its floor division.

ca, sans-serif”>The food distributor and manufacturer said the Reserve Bank of Zimbabwe (RBZ) needed to jump in and bail the company out through the productive sector finance facility made available to struggling firms.

Firms repay the loans at a rate of 30%.

Natfoods said the foreign currency for imports was made available to “avert serious shortages of flour and thus bread”.

It said maize mill capacity utilisations remained well below desirable levels and raw material availability for the production of maize-meal was still negligible, although up on last year.

For the half-year ending June 30 Natfoods made a net profit of $27,5 billion, which was 245% up on the previous year.

Turnover increased by 544% to $236,8 billion on the back of volume increases in all divisions except general trading, stockfeeds and packaging.

“The company is focussed on keeping volumes at profitable levels but this will remain an issue in the medium-term as shortages of local raw materials make the company more reliant on imports where adequate foreign currency has been difficult to obtain,” Natfoods said.

“Costs have continued to rise on a monthly basis with significant pressure coming from employees, particularly where increases are negotiated at industry level. Many costs which have exceeded inflation on a year basis and have outstripped the growth in turnover, have been outside the company’s control, straining margins in an environment where it is difficult to increase prices to the consumer.”

The company said sales volumes of cooking oil had improved and it had managed through pre-season contracts with soyabean farmers, to purchase a significant share of locally available beans.

“It is expected that these will shortly be supplemented by crude oil imports,” it said.

Natfoods is now the country’s largest local supplier of rice into the market.

Other types of rice have, however, flooded the market from the Far East and Malaysia which is sometimes much cheaper than the local product.

Natfoods said stockfeeds sales volumes during the first quarter of 2004 continued to deteriorate and reached unprofitable levels. – Staff Writer.

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