All stakeholders, including producers, buyers and government, met in the Lake Victoria side city of Mwanza early this month and agreed on the starting farm gate price of 1,100/-, which is almost double last year’s 600/- per kilogramme.

Tanzania Cotton Board (TCB) Managing Director Marco Mtunga told the 'Daily News' over the phone from Dodoma on Monday that the projections were to buy 250 million kilogrammes of seed cotton, with likely chances of getting more.

“The official estimate is 250,000 tonnes of seed cotton but the figure might rise,” Mr Mtunga said, noting that the price of 1,100/- per kilogramme could either rise or drop depending on the prevailing prices in the world market.

The 250 million tonnes at the price of 1,100/- per kilogramme win earn cotton producers a total of 275bn/- although industry sources expect an increase in both the price and output.

Announcing the price at the eighth cotton stakeholders’ meeting in Mwanza recently, the Minister for Agriculture, Food and Co-operatives, Prof Jumanne Maghembe, expressed hope that the price for the cash crop will surge as the buying season progresses.

Cotton producers are reportedly happy with the newly-announced prices and they are in high spirit to increase production to benefit from the windfall.

“This might not be the best price, but it is encouraging...producers are really happy,” the Chairman of Tanzania Cotton Growers Association, Mr Elias Zizi told the 'Daily News' on Monday.

Strong market fundamentals and bad weather forced up cotton prices last season, with farm gate prices going above the 1,000/- mark in some of the cotton producing areas.

The country experienced shortage that resulted into fierce competition among buyers. While TCB, the country's cotton sub-sector regulator, had earlier put the country's total output at 260,000 bales of lint cotton, only 162,000 bales were bought, missing the target by the whopping 38 per cent.

Bariadi-based Alliance Ginneries Limited, one of the giant cotton ginners in the country, missed its target by about 57 per cent in the 2010/2011 season, according to the firm's General Manager, Mr Boaz Ogola.

"Despite the record high prices, we managed to buy only 13 million against our target of 30 million kilogrammes," Mr Ogola was once quoted as saying. With increased government support to the sub-sector, analysts predict bright prospects for the white gold of Tanzania.

By Masato