ZIMBABWE’S largest milling company, National Foods, says its volumes in Q1 2019 increased 25,6% above last year buoyed by firm demand for maize, stockfeed and snacks, a company official said.
By Melody Chikono
Consumer demand remained robust during the period, continuing the trend seen at the end of the previous financial year.
Natfoods CE Michael Lashbrook told shareholders at the annual shareholders’ meeting on Monday that profitability for the quarter was in line with expectations and is working closely with the Reserve Bank of Zimbabwe to manage funding for its wheat import requirements.
Maize volumes increased by 55% compared to last year, as the grain harvest was lower than last season and consumers also elected to sell their home-grown maize to the Grain Marketing Board.
Stockfeed grew by 44% as the sector recovered from an avian influenza outbreak. Zimbabwe is still recovering from the aftermath of the highly pathogenic avian influenza (HPAI) that hit the country between May and August last year, killing more than one million chickens in South Africa and Zimbabwe. Snacks and treats increased by 48% as the company’s brands made inroads into the market, while its flour unit continued to operate at maximum capacity during the period.
Lashbrook said the volumes would have increased, but lacked capacity. He said the company was now investigating opportunities to increase capacity.
“The company continues to work closely with the RBZ to manage funding for its wheat import requirements. The flour unit is expected to continue to operate at maximum capacity for the foreseeable future. Efforts to develop local raw material pipeline are ongoing through the provision of support to local farmers. This summer our contract farming schemes will amount to 9 000 hectares of maize, soya beans sugar beans and popcorn,” he said.
Meanwhile, he said product supply during the period was largely consistent in the market in most categories, although some products which use imported raw materials such as cooking oil and salt were impacted by foreign currency availability.
“In the recent quarter, inflationary pressures have increased significantly particularly on imported items. Unfortunately, this has resulted in price increases across the basket of goods we produce,” he said.