The Sunday News
ON Monday, I attended a livestock auction in one of the wards in Lupane district and realised that the industry needs to adjust in order to survive. The changes have to come from both the buyers and the farmers. One stumbling block which needs to be changed is the farmers’ attitude towards the mode of payment. Farmers want cash and they are so adamant about it.
This is not only confined to this particular sale that I attended but many other sales in various districts.
What is surprising is that some of these farmers are actually pensioners who are earning monthly pension which they struggle to get out of the bank.
They sometimes have to go to the bank four to five times to take out amounts less than $100.
Now if it takes you a full week to get $100 or less out of the bank how do you expect a buyer to get $10 000 from the bank to buy 20 beasts? In simple terms if you cannot get your own money from the bank where do you expect the buyers to get it from?
Farmers have to come to terms with the fact that banks have no cash hence cash transactions are simply always not feasible.
They have to adopt some flexible payment terms which do not involve cash. Farmers and buyers simply have to adapt or perish.
You can’t just come and say I am not accepting anything other than cash, which will not work under the cash crisis environment.
It is generally true that most smallholder farmers sell their animals because they have a certain payment that they need to make which may be some bereavement, hospital or school fees costs.
Is it therefore better to ask the buyer to transfer the amount directly to the account where payment needs to be made like the school account and then you can receive the remainder in cash which is likely to be a smaller figure.
In addition to this, there are mobile money options which farmers need to familiarise with.
If they get the money transferred into their phones they can also pay whatever institution or person they owe money through a transfer. On the other hand buyers need to make an adjustment by realising that they have a role in educating the farmer who is the producer of the commodity they are buying.
It will be useful to send out an advance message to the farmers explaining the payment options that the buyer will be using.
This will help the farmer to have time to make decisions.
It may give the farmer time to look for banking details of whoever they need to pay and these are then given to the buyer during the sale. It may also help in deciding who goes to the market with the animal. In some cases young boys who are not able to make decisions as to whether to accept a cash transfer into their phone or not, are sent to the market and this result in a no sell at the end of the day.
So the buyers need to invest in sending out a detailed message about their payment options so that whoever is coming to the market has already made a decision to accept one form or another of payment. Trying to negotiate payment options at the market is mostly futile because some of the people who brought the animals are merely doing that on behalf of someone and will certainly have no power to make such decisions.
Lastly, the Government has to move in and make sure its departments and parastatals accept other currencies such as the South African rand. If for example schools, hospitals, clinics and other quasi Government institutions start accepting the rand, farmers will not have a problem accepting to be paid for their animal in rand.
However, what happens at the moment is that there is so much resistance towards the South African rand from Government institutions themselves and this makes farmers refuse the currency as well.
Surely it is understandable for farmers to refuse the rand if they cannot be able to pay school fees with it and they cannot pay dipping levies and the hospital won’t accept it.
If the system is to work there has to be adjustments from all the parties involved, that is farmers, buyers and service providers. Uyabonga umntaMaKhumalo.
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