JOHANNESBURG - Nestle said Thursday that it will stop buying milk from a farm owned by Zimbabwe President Robert Mugabe's family, who seized it from white farmers under his controversial land reforms. ( Pictured: Mugabe with the sick & starving masses of Zimbabwe behind him )The world’s biggest food company said in a statement on its website that it had begun buying milk from Gushungo Dairy Estate and seven other farms in February because local dairy processor, Dairiboard Zimbabwe, was not able to pay for its orders, according to news agency AFP.
“In February 2009 the food and economic crisis in Zimbabwe reached a level where the dairy industry was at real risk of collapse, and the Dairy Board (sic) was no longer able to buy milk from these eight farms,” the statement said.
“In light of our long-term commitment to Zimbabwe, we bought this milk on a temporary basis. This helped prevent a further deterioration in food supplies in Zimbabwe at that time.”
Nestle said the Dairiboard would resume its purchases from the eight farms and that the Swiss firm would stop receiving milk from Gushungo from Sunday.
International newspaper reports last weekend revealed that Nestle was buying milk from Gushungo, one of the farms seized under Mugabe’s land reforms meant to correct colonial-era imbalances that left the best land in the hands of whites. Gushungo is one of several farms now controlled by Mugabe’s family, and has been touted in state media as an example of successful land reforms.
Nestle’s statement is merely a smokescreen because Gushongo will supply Dairiboard, as it used to.
On 31 August Dairiboard said the declining sales volumes was on account of reduced exports of milk products, which are currently suspended until the supply situation improves. Dairibord Malawi has started milk exports into Mozambique and the full benefit is expected to be realised in the second half of the year.
“Sales of beverages started the year very low and greatly improved in the second quarter. Demand for milk products remains strong, but has not translated into sales because of the product supply constraints. Exports accounted for five percent of the sales volumes down from 13 percent registered in the prior year,” said the group.
The group registered a turnover of US$16,235 million, with eight percent of the turnover coming from the export market. Margins for the period under review were thin in account of high overhead costs and a low sales volume base.
The group recorded a net profit of US$1 million for the period under review. Overall milk intake for the period decreased by 56 percent. Malawi recorded a two percent increase in volumes, while Zimbabwe registered a decline of 64 percent.
The decline was caused by the economic challenges affecting the country in the previous years. The company said the consumer prices of milk products were controlled while the farmers battled with high costs and unavailability of stock-feeds and drugs, resulting in low average daily production yields of around 12 litres per cow.
Most farmers resorted to drying off even culling of the cows. Milk production has now stabilised and volume increases are expected within the next six months. The group is resourcing the milk supply development unit in an effort to upscale technical support to dairy farmers.
The Zimbabwean
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