I have been a bachelor this past week or so as Rozanne had to go to Edinburgh to sort out some family business matters. How things change! I looked after the washing and other household chores while she met with lawyers. As I have no photos related to the period I am writing about this week, I am posting some photos of the meals I was treated to by Portuguese neighbours and friends. Rozanne is back in Portugal but is spending a couple of days with her Zambian friend, Sarah Dean, in Lisbon. She certainly deserves a break.
In early 1994, despite it being loosely agreed in the last council of 1993 that we would move the Commercial Farmers Union (CFU) headquarters and restructure in 1994, the pace was slow. Therefore, in the January 1994 council meeting, our then president Anthony Swire-Thompson put forward a motion on agreeing on relocation seconded by me looking for full support of the council. At that time, a provisional site was identified and proposed on the south side of the ART Farm, which was just outside the northern suburbs of Harare. ART Farm, one of the CFU success stories was skillfully run by its director, Richard Winkfield known to all farmers, even ranchers, as Richard posted an article under the heading ‘The Bottom Line’ every week in the Farmer Magazine. Like so many farmers, his page was my go-to page on receipt of the magazine by post containing good information on topical and practical application of research or experience. Unfortunately, Richard has now passed, but if he was around, I am sure he would do a weekly podcast to keep us up with events. In reflection, I am just recalling how the post never failed to deliver in those days including the ‘Farmer’, how things have changed.
Getting back to the vote on relocation, the main voice against it was Tok Arnold, chairman of the Grain Producer Association, who even went as far as to say he had not even discussed it with his members, despite all commodities generally having their meetings just prior to the council. At that time, the CFU’s headquarters were in Agricultural House on Leopold Takawira Street, previously known as Moffat. He said that the present site was fine besides the parking problems and pollution. I argued that it was a nightmare for farmers or their wives to try to visit us. Many would and did avoid coming to our offices rather than face the gauntlet of walking the streets of Harare to our office. The safe streets of Salisbury were now filled with unemployed youth looking to make a living from petty crime such as mugging and bag snatching. Tok was a large man who I am sure was left unscathed by these thugs on his way from the Parkade at the Post Office to our offices unlike our female staff and farmers’ wives. Needless to say, when it came to the vote there were no dissenting votes registered, so perhaps Tok was convinced by the arguments for relocation by other councillors. Tok, who was an excellent farmers representative, although was sometimes contrary. Perhaps as he was an ex-policeman as was Ian Miller chairman of the Cotton Growers Association. Despite this previous mode of employment Ian was Tok’s opposite and required a tight rein to hold his enthusiasm in check. Following this vote, we now seriously started to look for both a site and to raise the cash for the new building. The plan was to do it from internal resources to ensure the building and the land it was to be built on would be unencumbered. ART Farm was rejected as there would have been major planning permission hurdles to face let alone the time it would take to get a subdivision.
Under the chairmanship of the Cattle Producers Association, Selby Chance, the restructuring committee was having great difficulties getting feedback from the commodities on how they could become more cost-effective in light of the levies no longer being compulsory. Only two commodity associations put forward papers on their proposed new structures and roles for the future. The two which did were Selby’s for the Commercial Cattle Association and Ian Miller’s Commercial Cotton Growers Association. The problem, as far as I could see, was twofold. Firstly, the elected chairmen did not want to diminish their kingdom, yet also were not sure how they would fund their organisations in the future. Some even said they supported change but only if it was implemented after their term of office. The second issue was in livestock and grain commodities, where possibly large savings could be made under a single senior livestock or a cereals and grains executive with a junior executive representing each association rather than each having a senior executive as it was now. With hindsight, what senior executive with half a brain would write a paper suggesting that he give up his job? None other than those that saw themselves in the top job.
Cereals and grains were obvious. They had previously been split into two, winter cereals and other grains, including maize and sorghum, to ensure Bob Rutherford could become president of the CFU rather than Bud Whittaker. Politics, even at the farmer level, can be vicious, with one of the mildest men, John Laurie, helping to orchestrate this event.
It is funny how the wheel has turned; at that time, it was felt Bud was too undiplomatic to deal with the Government, and now the very same man, as a board member of PROFCA, is promoting the present Farmers Compensation Agreement (FCA) under the defunct Global Compensation Deed, which the Government still touts despite the representatives of the farmers who are signatories to having rejected it following the Government's own default in its implementation. I saw a video this week with the minister talking about a secondary market in the bonds which will be issued when borrowing from the very ex-farmers they owe for their improvements. He talked about discount rates. I wondered would a hundred percent not be likely with the present Government's inability to service its debts? I would not like to tout that paper around Harare let alone offshore.
"My fear is that people are so desperate that they are valuing bonds based on their face value rather than their intrinsic value. It is likely that if they are eventually issued and traded, the discount value will be hard to reconcile with the face value, as it will so great." - Peter McSporran
Back to the CFU. We would have to find other ways to become more effective rather than cut costs quickly and therefore perhaps rely on attrition to make the harder structural adjustments. It was agreed, however, that any business owned or controlled by a trust or company owned by the commodities would have to be separated from the said commodity. It was felt and even advised, that these income streams could weaken their constituents' voice or, more importantly, bring about the downfall of the association if it had to be supported in the event of losing money. It was all very complicated, with so many opposing views. To help us, we brought in a team of union experts, under USAID, to help with the structures going forward. We were very pleased with their advice and proposed structures as were most of the commodities. Some of the staff not so much.
Also, in 1993, I started to talk, or rather, the Zimbabwe Tobacco Association (ZTA) approached the CFU about expanding the present tobacco diploma course at Blackfordby into a newly expanded college that would also offer a broader agricultural management diploma course. Ian Alcock was the president of the ZTA, and his vice president was Peter Richards. Together, we got the buy-in of the CFU, a subject perhaps for next week.
As I was writing this week's blog, out of the blue, I received a call from Kevin O’Brien, who now resides in Australia. Kevin and I go back to the mid-nineties, the period I am writing about now. I was a bit confused about the dates of when we first met, but Kevin resolved this by sending his first contract from Zim Stock Sales, where they and I planned to set up a commodity broking company. This we did under the name of Agrichange. It was in November 1993, but I met Kevin a few months earlier when he visited the CFU’s offices to get information on grain marketing, as he was involved in a consultancy on the regional markets for Coopers and Lybrand. Kevin was not long out of Pietermaritzburg University, which was well known for its agricultural alumni, many of whom were leaders in research and farming in Zimbabwe. I found him both engaging and intelligent, coupled with an eagerness to get involved in marketing. I thought he would be ideal for setting up our new venture. He, unlike us, had no entrenched ideas about marketing. Zimstock was owned by Alistair Smith, Rob Duncan and Patrick Murray. All well known to me, and in fact, when they set up Zimstock they approached Sandy Irvine and myself as possible investors to join them but suddenly withdrew the offer. I never asked why; I am sure they had their reasons. Zimstock was innovative in that it held video cattle auctions, making it easier for farmers to present cattle for auction rather than moving them to the nearest cattle sale pens. As the cattle remained at home, not accepting the final bid was easier as the cost of transport to and from the sale was not incurred. Many farmers sold their cattle at the sale pens because they had already sunk the cost of getting the cattle there and were reluctant to incur the cost of the return trip. A fact to the buyer's advantage. With the video auction the buyers would congregate normally at a hotel where the video was shown of cattle weighed and tagged for identification of any physical movement of the cattle following the sale. As I say it was innovative at that time but now, with the internet, the same process could and can be done from the farm office or your favourite lounge chair.
Agrichange was formed with little input from me and was successfully set up by Kevin. It was not easy in those early years in what we saw as the trend in the future of marketing. A free market. Unfortunately, although the Government talked about a free market, processors and even the farmers would lobby hard against it when it suited them. This was brought about by a number of reasons. Firstly the Government wanted cheap food for the masses, so was reluctant to give export permits for maize, even in times of surplus, thus denying the farmers an export parity price. This also suited the millers. Equally, the processors wanted their own requirements in, say, soya before allowing export but at the same time, if they could import cheaper than local suppliers, they wanted to import. In saying this, import parity was always the best price, but some farmers, especially livestock farmers, wanted imports even when local supply was present. All crop farmers wanted exports and restrictions on imports. There was much to learn about the free market in Zimbabwe at that time and the unscrupulous with the government’s ear no doubt made a lot of money. It did play havoc for traders involved in exports as the Government, without notice, could bring in either an export or import ban leaving some traders with huge losses to cover having already committed to the deal on ZIMACE or even SAFEX in South Africa.
The one error I made was joining Zimstock in the Agri Change venture in not recognising Patrick Murray as the driven trader he was. Although he promised not to dabble in the agricultural commodities which was earmarked to be Agrichange’s business, he could not help himself. It is not easy when the opposition can be within, Rob was only really interested in cattle and paprika while Patrick was happy to trade anything from cement to ostriches, the latter bringing problems to him. I believe he even exported some to Canada.
Kevin became a successful young broker, along with Nigel Philp. The largest company was Croplink, run on behalf of CC Sales by Ivor Prior, with Rory Bezuidenhout as his number two. They had the advantage of the network of CC Sales which had offices in all the farming centres with most farmers having used their services in cattle or property at some time.
Eventually, the Zimstock shareholders and I disinvested from Agri Change by selling the business to Diego Casilli from Zambia, an oilseed processor and trader in Zambia. Kevin grew his business, but with the events of the early 2000s, like many young people, he fell on lean times. I am sorry I did not keep closer contact with him at that time, many a drink we had at Sandro's when I became a born-again bachelor shortly after leaving the CFU. He is now running a feed mill company in Melbourne. Good luck to him and his family.
Disclaimer: Copyright Peter McSporran. The content in this blog represents my personal views and does not reflect corporate entities.
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