Good afternoon. Mozambique’s Cereals Institute, ICM, has suspended three major rice and wheat importers and says 34,300 tonnes of their grain have been seized. The immediate dispute concerns whether Companhia Industrial da Matola, África Indústrias and Pembe Mozambique imported without the institute’s approval. The larger issue is why ICM now has so much power over the supply and price of two basic foods.
The government ended the previous liberalised system after alleging that importers used inflated or duplicated invoices to transfer foreign currency illegally out of Mozambique. Under the replacement introduced this year, ICM registers importers, approves their orders, decides whether proposed quantities are justified, identifies acceptable suppliers and monitors payments and shipments.
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Those are legitimate public concerns. Mozambique should know how much rice and wheat it needs, prevent fraudulent foreign-exchange transactions and avoid shortages caused by poorly coordinated imports. A strategic reserve could also protect consumers when international prices or supply chains are disrupted.
The companies concerned do not automatically make sympathetic opponents of the new regime. África Indústrias is linked to Royal Group, whose conduct in the pigeon-pea dispute with ETG is now part of an international arbitration case against Mozambique. The same company has already faced questions over rice imports declared partly as seed, including 25,000 tonnes seized by Customs in March. The three companies should comply with the law and answer the allegations against them.
Their conduct does not, however, resolve whether the system itself is proportionate. The new arrangement concentrates regulatory and commercial powers in the same institution. ICM controls access to the market while retaining the right to import grain itself, negotiate government-to-government purchases, contract procurement and logistics services, and appoint partners to acquire cereals at source. It can therefore regulate private importers while potentially competing with them or selecting companies to perform parts of the trade.
The private importer nevertheless retains the financial risk. Companies must arrange bank financing, pay suppliers and cover freight, insurance, customs and storage. ICM does not replace them in those obligations. It stands between them and the transaction, granting permission and charging for doing so.
