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Wool and mohair farmers pocket M378 million

by Lesotho Times
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Bereng Mpaki

THE Lesotho Wool Centre (LWC) says it has paid wool and mohair farmers a total of M378 million for the produce it auctioned on their behalf during the 2018/19 shearing season.

The LWC claimed that the figure matched what the farmers used to receive from their preferred South African brokers, BKB. The LWC said this at a media briefing in Maseru. The press conference was held to announce the preliminary results of the LWC’s first ever wool and mohair auction which got underway in November 2018. If accurate, the payment announced by the LWC is slightly higher than the M341 million BKB said it had paid  to the farmers for the 2016/17 season.

However the LWC’s claims of having matched the farmers’ earnings for previous years contrast sharply with those of farmers who have bitterly complained about late payments which they say are far less than what they used to get when the wool and mohair was sold from South Africa through BKB.

Just over a fortnight ago thousands of farmers gathered in Maseru to stage what they described as the “mother of all protests” to press the beleaguered government to reverse its controversial 2018 regulations which bar them from selling their wool and mohair from outside Lesotho. The government insists that the wool and mohair must be sold from the LWC in Thaba Bosiu to boost the government’s tax earnings.

But this move has been resisted by the farmers who argue that they have been impoverished by the government whose real reason is to give controversial Chinese investor, Stone Shi, a monopoly in the wool and mohair industry. The LWC is a joint venture between wool and mohair farmers, through their association called the Lesotho National Wool and Mohair Growers Association, and Mr Shi’s Maseru Dawning company. However, the farmers dismiss the joint venture as a hoax, insisting Mr Shi is reaping them off.

The farmers’ claims were disputed this week by LWC representative, Mabilikoe Mosenye, who said in its first season which commenced in November 2018, the LWC had realised revenue amounting to US$ 33 million (M465 million) from the sale of wool and mohair to international buyers.

Mr Mosenye said of this amount, M378 million was paid directly to the farmers.

He said despite teething problems, the LWC had managed to attract some of the best wool and mohair prices in the world.

“We are proud to report that all the wool and mohair that was brought to the centre was successfully auctioned attracting some of the best prices for the season,” Mr Mosenye said.

“For instance, in the top wool categories we managed to sell for as high as US$13, 30 per kilogramme which was above that of the nearest producer, Australia, who sold at US$13, 05 per kilogramme.”

The M378 million that was paid to the farmers was broken down as follows: Maseru farmers received a combined total of M70 million, Mafeteng (M15 million), Mohale’s Hoek (M23 million), Quthing (M33 million), Qacha’s Nek (M18 million), Thaba Tseka (M53 million), Mokhotlong (M68 million), Butha-Buthe (M31 million), Leribe (M48 million) and Berea (M13 million).

In all, the LWC said it paid a total of 47 813 farmers for their produce.

Mr Mosenye said the total revenue generated by the LWC before payments to the farmers was US$33 million and “we believe this is a great contribution and injection of foreign currency into the national economy”.

“This (realisation of earnings in foreign currency) is unlike in the past where the farmers only received their payments after the South African brokers had converted the American dollars into the local currency.

“We are also proud to mention that since the wool trade began in Lesotho decades ago, this is the largest amount ever to be recorded in the business.

“This is a great milestone in the wool and mohair industry in Lesotho. What these figures mean is that that so many millions of maloti have been transferred to the Basotho farmers, giving them the much-needed buying power and economic benefit to sustain their families and their stocks for a better produce in the future,” Mr Mosenye said.

If accurate, the figures from the LWC auctions compare favourably with the farmers’ earnings when their produce was sold from South Africa through BKB.

According to the information supplied by BKB Lesotho field officer Monyaka Letsie, local farmers were paid a total of M341 million for the 2016/17 shearing season.

Mr Mosenye said despite their achievements, there were still challenges in the form of delays on paying the farmers.

“Our biggest challenge has been that of preparation and finalisation of payments to farmers. This has been one of the most painful exercises in our operations since we started the work,” he said, adding the delays in processing payments were caused by the farmers’ failure to supply them with all the relevant documents.

Efforts to get comment on the accuracy of the LWC claims failed yesterday as the Lesotho National Wool and Mohair Growers Association could not be reached for comment.


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