eBusiness Weekly
Business Writer
AFC Holdings, formerly Agribank, says it intends to raise $3 billion through the issuance of Agro-Bills to finance the 2021/22 summer cropping season.
The AFC Holdings has four subsidiaries: AFC Commercial Bank, AFC Insurance, AFC Land and Development Bank, and AFC Leasing Company.
The Government has been a major financier of agriculture in Zimbabwe and there has been calls to bring in the private sector into the game. Following its rebranding, the new institution will provide funding across the whole agriculture value chain from communal to large-scale farmers and the government injected $700 million as the initial capital.
According to a statement on the issuance of the Agro-Bill, AFC said the Bills will have a tenor of 270 and 360 days and will be in multiples of $500 000 and $1 000 000.
“AFC Holdings intends to issue out Agro Bills of $3 000 000 000 to finance the summer cropping season. AFC Holdings hereby invites corporates and individual investors to subscribe to these bills,” AFC Holdings said in a notice.
The Bills have special features such as prescribed asset status, liquid asset status, tax exemption, Government guarantee and AFC Holdings Financial Guarantee.
In June last year, AFC raised $100 million that was required by the Agricultural Marketing Authority (AMA) to support increased agricultural productivity through the agro-bills.
The agro-bill was to provide affordable financing to farmers in horticulture and oil seeds, sunflower seed, soya beans, groundnuts and sesame production.
According to a state of preparedness report for the 2021/22 season, the Ministry of Lands, Agriculture, Fisheries, Water and Rural Resettlement’s state of preparedness indicated that at least 100 000 hectares will be put under maize to produce 300 000 tonnes was targeted.
Farmers will be funded to grow 40 000 hectares of maize under irrigation and 60 000 hectares under summer dryland.
Soyabean farmers will be supported to grow 10 000 hectares under irrigation and the same hectare under dryland to produce 40 000 tonnes of the crop.
Farmers will also grow 7 000 hectares of traditional grains under dryland to give a harvest of 28 000 tonnes and 3 000 hectares of sunflower to produce 7 500 tonnes.
“All fertiliser and chemical companies have been given their contracts, ZFC, Windmill, FSG and others are the companies contracted to supply both basal and top-dressing fertilisers, ‘’ said the report.
The seed supply contracts for both soyabean and maize are being supplied by seed companies such as Seed Co, K2, ARDA, Zadzamatura, Syngenta and Agriseeds. In addition, AFC and CBZ should work on Letters of Credit for the fertiliser and chemical companies,” said the Ministry.
The major chemical companies include Fossil Agro and CP Chemicals and Trek, Petrotrade and CMED are also being engaged for the supply of fuel.
The mandate of the AFC Holdings Group is to support the Government thrust for agriculture production, productivity and Food Systems Transformation towards the attainment of national food security and His Excellency Vision 2030: Towards a prosperous and empowered Middle Income Status by 2030.
