US embassy cable - 04HARARE766

C O N F I D E N T I A L SECTION 01 OF 02 HARARE 000766 
 
SIPDIS 
 
FOR INR/I, AF, AND AF/S 
 
E.O. 12958: DECL: 05/08/2008 
TAGS: PINR, EAID, EAGR 
SUBJECT: (U) SNAPSHOT OF ZIMBABWE GRAIN STOCKS (C-AL4-00228) 
 
REF: A) HARARE 00305 B) HARARE 00349 C) HARARE 00170 
 
     D) STATE 52658 
 
Classified By: DCM ROBERT E. WHITEHEAD DUE TO 1,4 (C) AND (D). 
 
1. (c)  Following is a snapshot of the current grain stock 
situation in Zimbabwe.  We caution that grain stocks are a 
moving target and unimpeachable data is difficult to come by, 
since the GOZ has taken to treating Grain Marketing Board 
(GMB) information as a de facto state secret.  Nonetheless, 
we have been able to tap a variety of sources and piece 
together the following answers to questions posed in reftel 
d, and have included our analysis of likely GOZ intentions. 
 
A. (c) The UNDP resrep informs us that the UN has sketchy 
information indicating that the GMB is currently holding at 
least 200,000 MT of grain.  An EU expert projects that the 
GMB held as much as 300,000 MT but believes they may have 
drawn this down to as little as 50,000 MT to make room for 
new purchases from the upcoming harvest.  A 200-300,000 MT 
figure does not represent an unusual amount.  The GOZ has 
canceled a UN pre-harvest crop assessment, but virtually 
everyone scoffs at Minister of Agriculture's Made's claims 
that the upcoming harvest will yield 1.7 million MT of maize. 
 Most experts estimate a yield similar to 2003 -- 800-900,000 
MT.  This would satisfy approximately 60% of national 
consumption. 
 
B. (c) Most of the GMB grain has come from holdover stocks or 
local purchases, which we expect to be boosted by a recent 
doubling of the GMB farm gate purchase price and a GMB offer 
to provide free grain sacks and transportation for purchases 
from smallholder famers.  The Government of the Republic of 
Zambia (GRZ) reportedly owes Zimbabwe (GMB) 100,000 MT of 
maize from past borrowing to meet Zambian shortfalls.  The 
GRZ is reportedly reimbursing this debt from this year's crop 
surplus.  There is no indication that there have yet been 
major seizures of grain from either commercial or communal 
farmers.  GMB officials at roadblocks do confiscate excess 
stocks in transit (only three sacks may be transported at a 
time), but this has not to date been a major source of 
resupply for the GMB.  This may change as the harvest 
proceeds.  Very little grain was produced on commercial 
farmland, much of which is lying fallow. 
 
C. (c) GMB grain storage facilities are for the most part in 
an acceptable state.  These facilities are scattered 
throughout the country.  Normal GMB policy is to rotate out 
old stocks and replace them with fresh purchases from the 
harvest to avoid spoilage.  The GMB appears to be releasing 
holdover stocks into the market now to make way for fresh 
stocks. 
 
D. (c) The UNDP claims that the GOZ can mobilize up to USD 
280 million for GMB purchases.  Gold sales, increased 
platinum sales, and remittances have improved the forex 
position of the Reserve Bank of Zimbabwe (RBZ).  The USD 280 
million should permit the GMB to purchase 800,000 MT of 
grain, or however much may be needed to meet national 
consumption.  The EU expert states that the GOZ has retained 
a financial facilitator who has provided them a USD 60 
million line of credit backed by tobacco futures.  Our EU 
source also said that grain brokers had told him that the GMB 
has already contracted for 210,000 MT, 70% of which is maize, 
and the balance wheat.  RBZ Governor Gono recently told the 
Ambassador that he could not mobilize sufficient resources 
for commercial imports, but we note that it is not in Gono's 
interest to expend forex on grain that he could instead 
reserve for fuel and energy imports if donor largesse had met 
food requirements for free.  UNDP resrep Angelo told the DCM 
that the donors should be careful not to fall in the trap of 
equating a shortfall in the current harvest with a 
humanitarian crisis, given improved GOZ ability to source 
grain commercially.  Angelo had no sound figures on 
commercial purchases but believed that significant in-country 
deliveries would not take place until September. 
 
E. (c) We assume that senior GOZ leadership has information 
on GMB stocks that they are not sharing with the UN or 
bilateral donors.  There is little information pointing to 
current politicization of the distribution of GMB grain 
stocks other than in isolated cases during by-elections. 
Based on past performance, however, we fully expect the GOZ 
to use its control of food stocks to their full advantage in 
the March 2005 elections campaign. 
 
2.  (c) Comment.  At this juncture, there are disquieting 
indications of a comprehensive GOZ strategy to use food as 
one of its many weapons against the MDC in the 2005 
elections.  GOZ refusal to allow a harvest assessment and 
public statements that donor food will not be needed are 
clear signals of the GOZ's intent to take control of food 
stocks in the crucial electoral period.  This would permit 
them to dismantle existing foreign NGO structures in rural 
areas and ensure a minimum of prying eyes during the run up 
to elections.  In sum, the GOZ appears to be positioning 
itself to be able to punish those who oppose it, and to 
reward those who fall into line, as part of a larger strategy 
to quash the opposition MDC totally, and once and for all. 
SULLIVAN