Narrow sales margins recorded by the Botswana Agriculture Marketing Board (BAMB) during the 2014/15 financial year have resulted in a net loss, the board’s latest annual report has shown. BAMD’s audited financial results for the year ended 31st March 2015 show that the board recorded a net loss of P3, 468,044 compared to a net profit of P4, 129,090 recorded at the end of the previous financial year, 31 March 2014.
At the same time, the board recorded total operational sales of P267, 727,541 in the financial year under review reflecting a 34.7 percent growth from the previous year. BAMB Chief Executive Officer (CEO), Edison Wotho says the net loss position is largely due to narrow margins which BAMB achieved on the main products sold this year, as prices were largely depressed to the extent that sunflower was sold below cost.
“During the 2014/15 harvesting season BAMB purchased a total of 34,104 Mt of grains. Pulse purchases increased by 2000Mt from the previous year while there was significant drop in sorghum and maize purchases as a result of drought,” Wotho noted in a statement accompanying report noted.
The board also recorded a significant drop in Sorghum and Maize purchases, which Wotho attributed to the ongoing drought. Botswana has been experiencing “a drought year” after below-average rainfall that caused resulted in poor crop yields throughout the country. Production data from the agricultural sector indicate that while the 2013/14 ploughing season produced a bumper harvest, the drought hit hard in 2014/15 as crops failed due to prolonged dry spells.
Following a struggle that lasted for close to two years, BAMB recruited Wotho as its General Manager replacing Masego Mphathi. While a deputy PS in Agriculture Ministry, Wotho was responsible for crop production. With up to 80 percent of Botswana’s annual import bill comprising of food products, Wotho is expected to oversee BAMB’s efforts to reverse the decline of the agricultural sector and make Botswana self-sufficient in food production. Botswana remains a net importer of consumables despite millions of Pula spent on subsidies trying to improve farming.
The agriculture sector has become more significant on the domestic economy over the past few years, but remains far from being a major contributor to the national GDP, with a paltry contribution of two percent. Government owned National Development Bank (NDB) has so far spent over P100 million financing farming projects in the 2014/15 ploughing season and a further P125 million was expected to be spent during 2015/16. Meanwhile the yield forecast for 2014/15 has drastically declined as the national estimated production for cereals currently stands at 7 382 metric tons (mt), which is three per cent of the national cereal requirement of 300 000mt.