The Zimbabwe government has announced new cotton producer price for the lowest and highest grades, Zimbabwe's New Ziana reported.
US$0.77 per kg will be paid for grade D cotton, US$0.79 for grade B while US$0.81 and US$0.84 for grades B and A respectively.
Agriculture, Mechanization and Irrigation Development Minister Joseph Made warned that ginners who did not comply with the new prices risked losing their licenses.
"Farmers who have already sold their crop at low prices should be paid their balance. We are making it clear that companies should not continue underpaying farmers when they have to meet all operational costs," Made said.
Zimbabwe Farmers Union second vice president Berean Mukwende said the move was positive news for farmers.
"The season now has direction. The Cabinet has been the only source of our hope and they have delivered," he said.
Zimbabwe Commercial Farmers Union vice president Stansalays Goredema expressed confidence that ginners would pay the stipulated prices.
"We wait to see how ginners are going to handle it," he said.
Representatives of merchants declined to comment on the development, saying they would consult with their superiors.
Merchants had been offering between US$0.36 and US$0.50 per kg for cotton.
The country's cotton production is expected to rise from 250,000 tonnes last year to 280,000 tonnes in 2012.