Ethiopia’s Ministry of Industry (MoI) is going to set the price for cotton following the pointing fingers from and to cotton producers and textile factories.
The federal government imported cotton after there seemed to be a gap in the supply of cotton in the market and to stabilize the price. Yet the move it is going to take is said to encourage farmers to produce more and supply their product to the textile factories at a fair price.
Textile factories who are the major consumers of the locally produced cotton lament the inconsistent prices. This in return has forced to change their production cost
several times.
On the other hand, producers blame the cost of labor, high price of agriculture machineries, uncertainty in market and weather conditions for the inconsistent prices they have been offering.
According to Capital the supply chain of cotton is also an elongated one, which results lower earning by the farmers and channels significant profits to brokers.
Brokers buy a kilo of cotton for 30 Birr while they resale it to factories for 40 to 60 Birr.
“It is right for the government to stabilize the cotton market,” Tadesse Haile, State Minister of Industry, commented on the matter. “We are aware of brokers who set the price of cotton randomly and that discourage textile factories which causes them to incur additional costs. If it has not been for that interference, we sometimes may experience cases where farmers produce plenty and find few buyers.”
So we have to mediate the situation by setting a price that is fair for both farmers and factories. And we don’t want to keep on importing cotton. We need all locally produced cotton to be consumed by our factories. And setting a price will help us realize that.”
Discussion is being held with stakeholders and the Ministry for the purpose of drafting a regulation, the minister furthered. The regulation is going to prohibit brokers from involving in the delivery line of agricultural products for their interference is accused of impacting the industry.
Tadesse said, “Our agricultural products, especially those that are used as inputs for other industries, must be supplied at a fair price. Otherwise our effort to transform agriculture into an industry will face a big challenge. So we have to move the brokers who disturb the price. We only need producers and factories to deal with the products.”
The Ministry conducted a research on BT cotton which is one of the different genetically modified cotton variety that is reputed to rendering high yields. According to Tadesse MoI submitted a draft proclamation along with a synopsis of the research for ratification by the House of Peoples Representatives.
“We need more cotton to maintain our growing industry, and using GMO is one of the alternatives to boost production,” he noted.
Even if producers do not agree with the claim there is a shortage in cotton supplies, the current demand of cotton in the Ethiopian market is around 100,000 tons while the supply is around roughly 65,000 tons.
Ethiopian Cotton Producers, Ginner and Exporters Association (ECPGEA) Vice President Abreham Tadesse, on his part criticized the federal government for not giving proper attention to the industry. He argues there is 250,000 hectares of land that is available for cotton plantation while only 10 to 15 percent of this land is cultivated. “And this shows underutilization of the resource,” he added.
Abreham notes the solution to increase production is not GMO cotton. “We can still manage to scale up production without GMO cotton if government gives proper attention to cotton farming like it did to sugar farms.’’
On the other hand an agricultural researcher, Dr. Million Belay, opposes the Ministry’s plan to allow the use of BT cotton. He noted, “The Industry Ministry tells us the experience of Sudan and other cotton producers who made a good production by applying BT Cotton, and they argue that the chemicals that are used to kill cotton pests demand more finance while BT Cotton has its own immune system to combat pests.”
He argues the conditions, soil type and other related matters of Ethiopia and other countries are different and must be studied. ”No one gives an ear to our suggestion and the bill is in the final stages of ratification,” Dr. Million noted.
Source: Capital
