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Zimbabwe's Top Grain Miller Set to Shut Down as Foreign Currency Shortages Worsen

FILE: Christine Peresuh harvests corn in her garden in Harare, Tuesday, April 5, 2005.
FILE: Christine Peresuh harvests corn in her garden in Harare, Tuesday, April 5, 2005.

National Foods Holdings Ltd is planning to shut down some operations in Zimbabwe on Wednesday due to lack of foreign currency to pay for wheat purchased outside the country.

The company’s chief executive Michael Lashbrook told VOA Zimbabwe Service that they need foreign currency urgently to settle outstanding wheat supplies “so that production can continue” in the targeted food processing plants in the country’s capital, Harare, and second largest city, Bulawayo.

Lashbrook said the company, which is one of the largest grain millers, is in talks with the Reserve Bank of Zimbabwe seeking an unspecified amount of money for outstanding payments for grain supplies.

“National Foods is experiencing some disruptions to production at our wheat mills in Harare and Bulawayo due to the delays in paying for imported wheat. We are working with the RBZ to regularize the position. National Foods has a full pipeline of wheat so will be able to resume normal supplies once payment is made.”

He did not say whether they will still shutdown operations in the two cities if they get foreign currency to settle the debts, running into millions of dollars.

Reacting to reports that the company is threatening to shut down its factories, Industry Minister Mangaliso Ndlovu said Zimbabwe has enough wheat to last four months.

“We are prepared to assist those companies that are facing difficulties in sourcing foreign currency to purchase wheat and other needed goods.”

At the same time, chairperson Tafadzwa Musarara of the Grain Millers Association of Zimbabwe said locals should not panic over threats being made by National Foods to shutdown some of its factories, stressing that the country is set to receive adequate wheat supplies within the next few days.

“As I speak there are two ships carrying large quantities of wheat. One of the ships is at sea while the other has docked and people have started offloading wheat. Everyone is benefiting from the RBZ/GMAZ facility facilitating the purchase of wheat needed by millers. Some millers are operating well and we hope that the grain supply situation will improve.”

A shutdown will worsen food shortages in Zimbabwe and fuel skyrocking prices of basic commodities.

The Zimbabwe Grain Millers Association suspended the supply of bread and self-raising flour to biscuit producers to reserve it for bread.

Zimbabwe requires about 460,000 tonnes of wheat annually. The national wheat requirement is 38,000 tonnes a month with Zimbabweans consuming at least 1,5 million loaves a day.