Zimbabwe fertiliser firms face capital crunch amid supply chain woes

Zimbabwe’s fertilizer makers are bleeding cash right when global supply chains are getting wrecked by that Middle East conflict.

Working capital is a nightmare

• Clemence Chiduwa said all fertilizer companies are facing serious capital issues.
• Electricity costs are up to 16 US cents per kilowatt hour.
• Regional competitors pay around 6 cents for the same power.
• Labor costs are also too high relative to current efficiency levels.

The government wants to stop importing so much

• The sector cost Zimbabwe over US$331 million in imports last season.
• A new Industrial Development Fund has ZiG101 million available for firms.
• Companies can also tap into the central bank’s target finance facility.
• Chiduwa stressed prioritizing local procurement through PRAZ.

Sable Chemicals is getting back online

• Finance minister Mthuli Ncube is backing Sable to finish plant refurbishments.
• They’re aiming to produce 20,000 metric tonnes of top-dressing fertilizer.
• The plant is currently closed but should resume in May.
• Mutapa Investment Fund is also pumping US$5.3 million into Dorowa Minerals.

Regulatory fees are getting a haircut

• The committee noted that high regulatory charges are hurting competitiveness.
• They’re happy those fees are finally being reformed.
• Ease of doing business reforms are critical to level the playing field.
• A full report is coming to guide legislative support for the sector.