Agriseeds to increase sales by 50%
- Fri, 2015-06-12 (All day)
- Zimbabwe, Africa
Agriseeds Zimbabwe is expecting to increase its sales by at least 50 percent in volume and value terms this year following its proposed acquisition by the Johannesburg Stock Exchange-listed ZAAD Investment Limited’s seed manufacturing subsidiary Klein Karoo Saad Bemarking.
According to the transaction, ZAAD Investment Limited will acquire 80 percent stake Agriseeds owned by Royal Crown Investments Limited which is a joint shareholder with Chagaris (Pvt) Limited which owns the remaining 20 percent in Agriseeds.
Agriseeds managing director Mr Walter Chigodora told The Herald Business that the company has positive projections for this year and is quite optimistic of growth.
“With increased cash flow facilities, sales are expected to increase by at least 50 percent in volume and value terms this year. All regulatory approvals have been obtained,” said Mr Chigo- dora.
Agriseeds is an established private company that is active in the Zimbabwean seed production industry.
The company’s core business is anchored on seed production and from inception and its focus has been to engage smallholder farmers in producing seed suitable for them.
Of late the seed industry has been attracting quite a lot of investment.
Last year Limagrain acquired a significant stake in Seed Co enhancing the company’s capacity to extend its tentacles into more countries on the African continent.
Since its acquisition Seed Co has started planning to venture into the vegetable seed business leveraging on its partner Limagrain’s extensive knowledge of the sector.
Limagrain, which acquired about 36 percent in Seed Co through its unit Vilmorin & Cie, rakes in about $50 million in profit every year from its vegetable seed business.
Seed Co is now planning to set up a Strategic Business Unit for the vegetable seed business which will, however, be guided by the principles of the grain business.
The seed industry in general continues to express confidence in Zimbabwe’s seed supply, hence the extra investment.
In 2013-2014 season, it is estimated that seed houses were distributing a total of 56 000 tonnes of maize seed to outlets across the country.
Of the 56 000 tonnes, 52 000 tonnes was hybrid seed while 4 000 was open-pollinated maize seed varieties. There were also sales of 500 tonnes of white sorghum seed.
In light of the above, agricultural experts have urged Government to intervene and assist the vulnerable who are finding it difficult to buy seed and fertiliser so that farmers can access inputs and so plant on time.
The Government, however, is challenging the seed industry to assist farmers by supplying agro inputs to smallholder farmers as well as coming up with strategies aimed at improving productivity.
Agricultural experts are of the view that boosting agricultural production in Zimbabwe requires the seed companies to look critically at how best the industry can improve access to affordable and reliable supply of high quality seeds.