Falling cotton prices in the World market and the government’s neutrality stand on the development of the crop have spiked fear among stakeholders in the country’s cotton industry.
Farmers’ wish to sell their produce at a minimum price of 1000/- per kg however, according to indexmundi.com, a site that posts the worldly crop prices, reveals that the market has experienced an acute cotton price drop from $1.1 per kg in April to 88.53 cent per kg in May this year.
Elias Zinzi, Tanzania Cotton Growers Association (TAGOA) chairperson, told The Guardian, over a phone interview that, “…if the government fails to issue a stand on subsidising the farmers, they will give up on developing the sector.”
According to the cottonmarketnews.com site, Tanzania’s cotton sub-sector, which employs 14 million people, about 40 per cent of the country’s population, is on the verge of collapse, unless the government takes swift measures to rescue the situation.
A recent report by a task force formed in June last year by the ministry of Industry and Trade in collaboration with Consolidated Holding Corporation (CHC) has revealed that Mbeya Textile Mill Limited has stopped operations due to lack of cotton.
Joe Kabissa, director general of the Tanzania Cotton Board (TCB) in a statement posted on the TCB website, cotton.or.tz, he predicted that cotton lint production in the country, may fall 28 percent this season after prices paid to farmers tumbled because of the global financial crisis.
As many as 500,000 Tanzanian farmers cultivate about 485,000 ha (1.2 million acres) of cotton in the country's northern, coastal and western regions.
Tanzania is Africa's fifth-largest lint-cotton producer, after Egypt, Nigeria, Burkina Faso and Benin, according to 2007 statistics on the Food and Agriculture Organisation website. The country is the world’s 20th largest producer, according to the FAO.