By Godfrey Marawanyika | From Bloomberg News

Zimbabwean cotton growers are asking the competition regulator to reconsider its decision removing a price guarantee for their crop, said Garikai Musikavanhu, vice president of the Zimbabwe National Farmers Union.

The Harare-based Competition and Tariff Commission on Monday announced that individual lint farmers must negotiate prices with buyers, removing a government-set minimum price. The cotton price was $0.63 per kilogram (2.2 pounds) last year when the country produced 143,000 metric tons of the crop, according to the Cotton Ginners Association of Zimbabwe.

“We have appealed against their decision,” Musikavanhu said. “The situation is going to be worse for farmers.”

In 2012, the government began fixing a price for cotton to to protect farmers against declines in the market. Under the rules, buyers were only entitled to recover the cost of inputs if they paid cotton farmers the set price or more.

Cotton buyers cut the amount of fertilizers, seeds and agricultural chemicals they provided to farmers last year, which is resulting in lower yields, said Musikavanhu.

Companies reduced their support after finding some growers were selling their products outside of contractual agreements, Godfrey Buka, director-general of the Cotton Ginners Association of Zimbabwe, said on Monday by phone. They also faced cash-flow “issues” in the economy that’s struggling to gain traction as consumer spending remains weak, he said.

“Ginners did not fund farmers last year, so effectively this means that the national output is going to be much lower this year compared to last year,” said Musikavanhu.

The cotton-selling season is expected to start in May in the southern African nation, where merchants include Cottco Zimbabwe Ltd., and the local unit of Olam International.

Zimbabwe vies with Tanzania to be the largest cotton producer in southern and eastern Africa, according to the World Bank.