eBusiness Weekly
Business Writer
Government is hoping the protracted dispute over Division of Proceeds (DOP) between Lowveld sugar producer Tongaat Huletts Zimbabwe and hundreds of outgrower cane farmers will be resolved soon in a development expected to ramp up sugar output.
DOP is a ratio used to share sugar cane proceeds between the miller (Tongaat) and outgrower farmers.
Tongaat owns and operates Zimbabwe’s only two sugar mills at Triangle and Hippo Valley estates in Chiredzi and charges outgrower farmers a fee for milling their cane.
Outgrower farmers cried foul over the development and petitioned Government to intervene citing viability if the DOP ratio was not adjusted downwards.
Provisional State Minister for Masvingo Ezra Chadzamira told Business Weekly his engagement with Tongaat over the DOP dispute was underway.
‘‘We have already been in touch with Tongaat with regards to concerns over the raging DOP stand-off with farmers because we want a win-win situation between the two parties for the good of the sugar industry which is a vital plank in the provincial and the national economy,’’ he said.
‘‘Tongaat said they took note of our submissions and promised to come back to us
with a response and we are still waiting for them.
“It is our hope that they will give us a response soon so we urge our farmers to be patient,’’ said Chadzamira.
He said Government will continue to find ways of narrowing the differences between outgrower farmers and Tongaat to ensure a harmonious and mutually beneficial relationship between the two parties.
‘‘The sugar industry in the Lowveld is currently the backbone of our provincial economy and we will continue to engage all stakeholders to ensure that there is harmony which is a precondition for growth.
Government will continue to lend an ear to both outgrower farmers and Tongaat because they are all in business,” said Cde Chadzamira.
Farmers want a review of the DOP ratio which they say will cushion them from high labour and operating costs in the capital and labour intensive cane farming industry.
Most of the farmers were struggling to break even on the back of high operating costs and choking debts that were exacerbated by Tongaat’s decision to backdate recovery of DOP overpayment to four years ago.
Former Minister of Industry and Commerce Minister Dr Mike Bimha had promised to resolve the DOP stand-off but failed to do so before he left office and farmers are optimistic his successor Minister Nqobizita Ndlovu will give urgency to the problem.
