Zimbabwe’s economic performance largely depends on developments in its agricultural sector. The country has 4,130,000 hectares of arable land, 25 percent of which is cultivated using animal and manual draught power. Following the government’s fast-track land reform program which began in 2000, irrigation infrastructure deteriorated, and most of the new landowners depend on rain rather than irrigation for their crops. As the weather pattern changes and droughts become more frequent, the country has failed to produce enough grain to meet domestic demand. The government grants 99-year leases for agricultural land, but the protections of such leases are too weak to serve as collateral for financing, hindering agricultural investment. The government has also instituted a number of inefficient “command” agricultural subsidy programs which have hampered growth and corruptly squandered billions of dollars. During the 2020/2021 agricultural season, however, the government allowed the private sector to fund agricultural activities, which improved transparency in the sector. The government has taken steps to promote cultivation of sorghum and millet, which are more ecologically compatible with Zimbabwe’s semi–arid areas. The government is also in discussions with local financial institutions to accept the 99-year leases as collateral security.
Zimbabwe has a great need for new and updated equipment to improve agricultural production. The government estimates Zimbabwe has over 50,000 medium- to large-scale farmers, and the country only has approximately 10,300 functional tractors of the 40,000 needed for commercial cultivation. In 2020, the government signed agreements with international partners including U.S. firm John Deere to import tractors and other agricultural machinery. Local farmers have commented they prefer American quality and value over Chinese and Belarussian models competing in the market.
Tobacco is the most important cash crop in Zimbabwe in terms of generating foreign exchange. It exported just over 210,000 tons of tobacco at an average price of US$2.80, earning the country US$588.7 million in 2021. The tobacco industry is one of the nation’s biggest employers and is dominated by small-scale farming versus large commercial operations. Zimbabwe exports its tobacco to Asian countries, with China accounting for the bulk of the exports. Tobacco output for the 2022 marketing season is expected to decline compared with that of the 2021 season due to adverse weather conditions and a decline in the area planted.
Local demand for soybeans is on the rise owing to its use as cooking oil, stock feeds, and other foods. Soybean production stands at an estimated 71,290 tons, which is only enough to meet 30 percent of national demand. Zimbabwe requires about 240,000 metric tons of soybeans annually for food, feed, and other industrial needs. While the country depends on soybean imports from Zambia and Malawi, the government hopes to reduce imports following the introduction of its mostly inefficient command soybean program. At the farm level, soybeans are a short season crop with a lucrative return on investment of up to 200 percent. The Russian invasion of Ukraine conflict has put added pressure on farmers to grow more soybeans as soybean oil-producing countries restrict exports.
According to a 2017 report by the UN Conference on Trade and Development, Zimbabwe has the capacity to produce 600,000 tons of cotton, and the country’s 22 ginners have an installed ginning capacity of 750,000 tons per annum. Cotton, Zimbabwe’s second most important cash crop, is usually grown under contract farming arrangements where contractors supply production inputs (seed, fertilizer, and chemicals) to farmers on loan. At harvest, the contractor buys back the contracted seed cotton, deducts costs of the inputs, and pays the contract farmer the remaining balance.
Despite cotton’s potential, Zimbabwe only produced 85,000 metric tons of cotton in the 2019/20 agricultural season, which fell short of the government’s goal of 100,000 metric tons. According to the Cotton Producers and Marketers Association, Zimbabwe produced 116,052 metric tons in the 2020/2021 season because of good rains and subsidized inputs. An official from the Cotton Company of Zimbabwe stated output declined in the 2021/22 marketing season due to the late onset of the rains which resulted in a delay in planting.
Certain departments within government such as the National Biotechnology Authority of Zimbabwe (NBA) now believe the sector can benefit from the adoption of improved seed varieties including GMOs and production of quality fabric to increase demand for raw cotton. Currently, however, there is no political will to fully embrace the use of GMOs in cotton production.
Corn is Zimbabwe’s principal food crop. According to a June 2022 Foreign Agricultural Service (FAS) Grain and Feed Annual report, Zimbabwe’s corn crop for marketing year 2022-2023 is estimated to be at 1.6 million metric tons – 43 percent less than the 2.7 million metric tons produced in marketing year 2021-2022. As a result, the Government of Zimbabwe lifted a ban on corn imports introduced in May 2021 and announced a plan to import 400,000 metric tons. Macro-economic challenges, sub-optimal weather, and high input costs contributed to the production drop.
There are opportunities for U.S. companies to sell high quality tractors to local farmers under the country’s agricultural mechanization drive as well as irrigation equipment given frequent droughts. There are opportunities to provide food processing machinery in line with the government’s goal of increased value addition. There are also opportunities in the agro-chemicals subsector. In particular, the ZIDA emphasizes the need to increase capacity in manufacturing of fertilizer, insecticides, and pesticides.
Commercial Farmers Union of Zimbabwe
Harare Show Grounds, 7, Belvedere, Harare
Tel: +263 4770029/57/59/71
Tobacco Industry and Marketing Board
429 Glen Eagles Road, Southerton, Harare
Tel: +263 772145166/9
Zimbabwe Farmers Union
5 Van Praagh Avenue Milton Park, Harare
Tel: +263 771564554