Zimbabwe’s agricultural sector is showing renewed resilience and transformation, with Seed Co International posting a dramatic increase in profitability while the Agricultural Marketing Authority (AMA) reports that the country’s Grain Import Levy is already financing irrigation infrastructure aimed at strengthening long-term food security.
These developments highlight growing investment in agricultural production, improved regional market performance, and a shift to the sustainable farming systems as Zimbabwe braces for another potentially challenging rainfall season.
The Group Chief Executive Officer (CEO) of Seed Co Group is Morgan Nzwere reported that after-tax profit more than doubled to US$13.1 million for the year under review, up from US$5.7 million previously, driven by stronger regional operations, improved margins, and a strategic pivot toward open-market sales that offset a difficult year in Zimbabwe’s traditional government-linked seed business.
Management said normalized revenue grew by about 10 percent after adjusting for accounting distortions caused by hyperinflation reporting in Malawi. Gross profit margin improved from 50 to 53 percent, reflecting stronger pricing and an improved sales mix, despite largely unchanged volumes.
Operating profit rose sharply to US$29 million from US$15.3 million the previous year, while improved cash generation allowed the company to reduce borrowings and lower finance costs.
Operating cash flow increased nearly 40 percent to US$15.9 million, strengthening the balance sheet even as the business continued investing across key regional markets.
Regional operations remained the company’s strongest growth engine, led by Tanzania, alongside solid contributions from Zambia and Malawi. Management noted that close to 90 percent of Malawian sales were conducted on a cash basis despite ongoing economic challenges, enabling the company to repatriate some proceeds notwithstanding market constraints.
Capital expenditure declined to US$5.3 million as major expansion projects in Tanzania and Zambia neared completion. Management indicated annual capital spending is expected to stabilize around US$5 million going forward.
The company’s asset base expanded by nearly 20 percent to US$187 million, supported by stronger regional currencies, larger inventories, and higher advances to growers participating in farmer support programs. Shareholders’ equity rose by 32 percent, while liquidity improved significantly as net debt-to-equity fell from 21 to 16 percent.
While regional operations flourished, Seed Co acknowledged a tougher operating environment at home. Revenue from its traditional Zimbabwean seed production and processing business fell sharply as the company deliberately scaled back exposure to lower-margin government contracts in favor of commercial and export markets.
Local sales volumes declined by 40 percent during the year as the business shifted toward open-market transactions, which now account for nearly 70 percent of turnover. Management described the strategy as improving earnings quality while reducing exposure to payment delays and price controls associated with state programs.
“If we could operate entirely through the open market in every country, that would be our preferred business model,” company executives said during the results presentation.
The regional business has now grown to almost three times the size of Seed Co’s Zimbabwe operations, which management attributes to stronger demand for proprietary seed varieties and growing confidence in the company’s genetics across African markets.
Emerging markets including Nigeria, Mozambique, Ethiopia, and the Democratic Republic of Congo remain central to the group’s long-term growth strategy, despite political instability and disease outbreaks affecting some of these countries.
Alongside its commercial expansion, Seed Co continues to invest heavily in research, technology, and climate resilience. The company said artificial intelligence is increasingly being incorporated into breeding programs, manufacturing, and distribution, moving beyond basic data analysis into practical decision-making.
Its research program, supported through a partnership with French seed company Limagrain, has produced new maize hybrids in Zimbabwe and Zambia, soybean varieties in Kenya, maize varieties in Nigeria, and a new white wheat variety in Zimbabwe developed specifically for bakers.
Production infrastructure has also been strengthened through new colour-sorting technology that has largely replaced manual seed selection, expanded irrigation now covering about 70 percent of production, and the commissioning of an artificial seed dryer that processed almost 9,000 metric tonnes against its original 5,000-tonne design capacity.
A new processing facility in Tanzania is nearing completion, while another is under development in Zambia to address regional seed shortages.
This emphasis on irrigation and climate-smart agriculture aligns with broader government efforts to improve resilience through the Agricultural Marketing Fund.
The AMA says proceeds from Zimbabwe’s Grain Import Levy have already financed approximately 850 hectares of irrigated land, marking one of the first major outcomes of the fund established under Statutory Instrument 87 of 2025.
The Authority unveiled this progress during its first Agricultural Marketing Fund impact assessment and media tour at the Glen Somerset Irrigation Scheme in Murewa District.
The levy was introduced to create a structured framework for importing maize, wheat, soyabeans, and other agricultural commodities while encouraging domestic production and reducing reliance on imports. Government has positioned it as a development mechanism rather than simply a revenue-collection tool.
Initially, only imported maize attracted a levy of US$10 per metric tonne. Following consultations and market assessments, however, Government revised the structure in May this year, raising the maize rate to US$40 per metric tonne while introducing new levies on wheat, soyabeans, and soyameal.
AMA, which collects the levy before remitting proceeds to the Consolidated Revenue Fund, says the money is ring-fenced through the Agricultural Marketing Fund to finance irrigation infrastructure, farmer payments through the Grain Marketing Board, and other productivity-enhancing projects.
According to the Authority, the roughly 850 hectares already brought under irrigation demonstrate that levy proceeds are being translated into productive investment capable of supporting year-round farming and reducing dependence on increasingly unpredictable rainfall.
The program comes as seasonal forecasts point to a heightened likelihood of El Niño conditions in the coming agricultural season, underscoring the importance of irrigation in safeguarding food production.
AMA also noted that legal challenges previously filed by the Grain Millers Association of Zimbabwe over the revised levy structure have since been withdrawn, leaving no outstanding litigation concerning Statutory Instrument 87 of 2025.
Officials said the Glen Somerset tour was intended to improve transparency by allowing stakeholders and journalists to see firsthand how levy proceeds are being used.
“The Grain Import Levy is a tax on imports and an investment in Zimbabwe’s agricultural future,” the Authority said, adding that irrigation development strengthens food security, farmer incomes, market stability, and climate resilience.
Taken together, Seed Co’s strong financial performance and government’s continued investment in irrigation infrastructure illustrate a sector increasingly focused on productivity, technology, and long-term sustainability.
While rising fertilizer, fuel, and logistics costs, geopolitical uncertainty, and shifting weather patterns continue to pose significant risks, both public and private players are investing in innovation, infrastructure, and regional expansion to position Zimbabwean agriculture for stronger growth in the years ahead.
