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Tobacco farmers net $484 million

Posted in Tobacco & Related

ZIMBABWE - Zimbabwe tobacco farmers have so far auctioned 164 million kg of the crop worth $484 million since the opening of the 2015 selling season in March.

Statistics released by the Tobacco Industry and Marketing Board (Timb) yesterday revealed that the golden leaf sales were down by 19 percent for day 72, compared to the same period last year.

Tobacco prices have, however, remained depressed as average prices at $2,96 per kg are 6,87 percent lower compared to $3,18 recorded in the same period last year.

Zimbabwean farmers have since 2009 been increasingly engaged in tobacco farming due to its favourable prices compared to cotton and maize prices, but there are new fears that if the new low pricing trend continues farmers might abandon the crop.

In the 2014/15 season more than 106 000 growers have registered as compared to 88 444 last year.

Out of the registered growers, 26 816 are new growers. Of these more than 1 000 are new growers from Masvingo, Midlands and Matabeleland North provinces, areas which were previously non-traditional tobacco growing areas.

Andrew Matibiri, Timb chief executive recently indicated that tobacco deliveries were continuing at contract floors while a decline had been registered at the auction floors.

“Most farmers who sell at the auction floors have sold their crop. Only Mashonaland East and Manicaland still have a significant crop,” he said.

Matibiri said the auction floors used to record deliveries of between 8 000 and 10 000 bales a day but were now averaging 3 000 bales.

He said the season was going on well and prices were close to where they were last season.

This comes as a number of farmers have been complaining of the low prices offered especially at the auction floors while merchants have been complaining of low quality crop.

Matibiri, however, noted that some farmers lacked knowledge on production and presentation of the crop and were not up to date with market requirements.

“Timb has partnered with Leaf Trade Limited to educate farmers on the market requirements. Merchants no longer want small leaves but now require big and darker leaves. We are assisting farmers to produce a leaf that is required by the buyers so they can get viable prices,” he said.

At least 220 million kg is expected to be sold this year up from 216 million kg earning the country nearly $600 million.

However, agriculture experts believe that the heavy rains the country received in January and February greatly compromised both the quality and quantity of tobacco.

They estimate that a yield of one-and-a-half to two tonnes per hectare has to be reviewed downwards.

At the peak of output, the southern African country produced 236 million kg of tobacco, which is commonly referred to as the golden leaf locally and is grown mainly by small-scale farmers.

Prior to the land reform programme, the country grew most of its tobacco on large commercial farms.

Zimbabwe traditionally competes with countries including Brazil and the United States as a key source of the top-quality variety of the crop known as flue-cured tobacco.

June 22, 2015; http://www.dailynews.co.zw/articles/2015/06/21/tobacco-farmers-net-484-million