Seed Co record low volume sales

Audrey Galawu

Seed Co Limited experienced a 28% volume decrease in seed sales compared to the same period last year.

In its 2024 interim report, Seed Co highlighted that the decrease is attributed to delayed rains and diminished enthusiasm for cropping due to the El-Nino phenomenon.

“Compounding these challenges, the current agricultural season is experiencing adverse weather conditions attributed to the El-Nino effect, further exacerbating economic strains.

“From an operational perspective, the delayed rains this season led to increased demand for small grains and legumes, extending into the last quarter of the financial year in Zimbabwe and neighbouring countries.

“This demand for small grains holds significant potential to clawback annual sales volume performance not only in Zimbabwe but also in neighbouring countries.

“Regionally, record sales in East Africa and certain parts of Southern Africa were registered, which is anticipated to mitigate the overall impact of decreased trading in some Southern African markets that were adversely affected by El-Nino,” reads the report.

Economic difficulties are persisting in Zimbabwe characterised by shortages of both foreign and local currency, leading to exchange rate-induced inflation and a dominance of the informal economy over the formal sector.

The company, however, achieved increase in inflation-adjusted revenue from ZWL$189.4 billion in the same period from the previous year to ZWL$266.5 billion, which the company said aligns with increasing proportion of USD denominated sales against the pronounced depreciation of the exchange rate and the resulting inflationary impacts.

In terms of operating profit, the company recorded an increase from ZWL$28.8 billion to ZWL$484.6 billion for the period in question.

The enhanced profitability outcome can be credited to the restoration of profit margins and the alignment of the exchange rate with open market forces experienced in the better part of the first half.