Wool farmers owed M165m

Wool farmers owed M165m

MASERU – THE Wool Centre owes a staggering M165 million to more than 11 000 farmers across the country, thepost can reveal.
Figures released this week show that the centre has sold nearly 189 million worth of wool and mohair.
Yet it has only managed to pay M15.8 million to only 1 748 farmers.
In other words, farmers have only received 8.7 percent of what the Stone Shi-controlled centre owes them and just over 10 percent of them have been paid.

Documents seen by thepost show that by December 13 last year the centre had sold wool worth M96 million and mohair worth M5.7 million.
Since then the centre has generated another M87 million from wool to bring the total sales to M183 million.
Add the M5.7 million from mohair and the total comes close to a whopping M189 million.
That however has not translated to fat cheques for the farmers who are already complaining about the perennial delays in their payments and are also fearful that the opaque system used at the centre could see them lose out.

While farmers are squirming over the slow payments Shi could soon be smiling all the way to the bank.
Based on his four percent brokerage fees Shi stands to make M7.5 million in commission from the M189 million.
And he doesn’t queue for that payment like the poor farmers because he simply deducts it before he transfers the money to the farmers.
Shi, therefore, has become an instant millionaire on his first season as the only wool and mohair broker in Lesotho.

This year Lesotho’s wool and mohair is expected to generate about M800 million, according to the prices at the auctions in Port Elizabeth.
If M800 million is the minimum that Shi will generate from his trade with Chinese buyers it means he could earn as a mouthwatering M32 million this year, almost enough to cover the M33 million he claims to have invested in building the centre’s warehouse.
But his profit could be astronomical if the claims by the farmers that he invested only M2 million in the centre are true.
With the outcry from unpaid farmers increasing, the government is under intense pressure to intervene.

On Tuesday the Cabinet sub-committee on wool led by Communications Minister Thesele ’Maseribane asked the Wool Centre to explain why the farmers have not paid.

Manama Letsie, the centre’s spokesperson, said the centre promised to have paid 5 000 farmers by the end of next week.
He said the centre’s bankers were present at the meeting and “they promised that starting next week the centre can use online banking which will not need the centre to submit farmers’ lists for payments to the bank. It will also allow the centre to make as many payments as possible”.
Letsie said the target is to disburse M100 million to farmers by the end of next week.

He said so far the centre has sold 3 068 bales of mohair and 8 000 of wool. The inventory received so far, he said, is 18 554 of both wool and mohair.
He said the centre has sold every bale of mohair it received. He said between “11 000 and 13 000 farmers” have delivered their wool to the centre.

There are nearly 40 000 wool and mohair farmers in Lesotho.
Asked why the farmers were not being paid on time Letsie said the problem was with the payment system that restricted them to paying only 300 farmers per day.

He said they have not sold the wool and mohair as fast as they wanted because there was “some political sabotage”.
He said the other problem is that they have not received enough containers for shipment. The supplier, he said, only delivered 20 containers of the requested 75. Letsie also blamed the delay on the farmers who he said had failed to provide bank accounts on time.

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