Government stops subsidizing the price of seed cotton as of this agrarian campaign

The government will no longer subsidize the price of seed cotton in the current agrarian campaign, contrary to what happened in the previous one, in which, for the first time, 240 million meticais were invested to guarantee the maintenance of the minimum price.

The information was shared by the Minister of Agriculture and Rural Development, Celso Correia, in Netia, Monapo district, Nampula province, after the cotton companies guaranteed that they would be responsible for maintaining the price of 25 meticais per kilo in the current campaign.

"This year, in view of the good performance, a price subsidy by the government will not be necessary. We want to congratulate the parties involved and once again make reference to the level of organization that allows for a results-oriented dialogue," the minister said.

The consensus was reached after negotiations between producers and development companies, intermediated by the Government.

The price of 25 meticais per kilo was proposed by the producers, through the National Forum of Cotton Producers (FONPA), against the 24,50 of the Cotton Association of Mozambique, but the mediation of the Government resulted in the desired consensus.

Correia revealed that, thanks to the subsidy that the Executive granted last year, the cotton production grew 75% and guarantees income to 150 thousand families of small farmers, going from 30 thousand to 52 thousand tons.

As a result, according to the governor, there is a doubling in exports of fiber, from 20 million dollars to about 38 million dollars. As a result, the State's revenue may exceed 70 million meticais against 21 million meticais in 2020.

"Our commitment as a government is to continue to stimulate the growth of the sector, and this year we will expand the Cotton-Sustainable and also ensure that next year the reference price remains stable and protected from any exchange or market shocks," he assured.

The president of the National Cotton Producers Forum, Benson Simoco, said that the 2020-201 campaign was good and motivating, and he considered the consensus reached to be fair for recognizing the efforts of the producer families of this cash crop.

"It was a campaign well received by producers due to the increase in the price per kilo, which motivated more adhesion and enrollment of new members who expanded their production areas," he noted.

Francisco João Ferreira dos Santos, president of the Mozambican Cotton Association, pointed out that the price achieved will satisfy the sector's expectations.

"What our Government invested in increasing the producer's income was so important to minimize the impacts of the crisis. It allowed us to multiply what we will harvest this year, and all of us, without exception, were able to structure this extraordinarily complex operation in a very short time," he concluded.

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