Tobacco selling season opens with high prices

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Zimbabwe’s tobacco selling season opened Tuesday in Harare with the highest quality golden leaves on auction fetching US$4 per kilogram a major jump from last year’s average of US$3.00.

The country’s is expecting that over 77 million kg tobacco will go under the hammer this year with small scale farmers contributing 35 million kg. Tobacco Industries and Marketing Board (TIMB) officials attributed the increase in tobacco on the market to an increased number of farmers taking on tobacco farming.

Farmers at the auction floors said the starting prices were very encouraging and more and more farmers would be forced into tobacco farming.

“The signal is very positive. The prices are very good and we hope to see a jump in prices as the selling season peaks up. I am seeing an average of US$3.50 to US$3.80 which very good. We are going to see more and more farmers taking up tobacco farmingin the near future,” said Tobacco Growers Trust chairman Wilfanos Mashingaidze.

The prices compare favourably with those in the leading tobacco producing country, Brazil of between US$4,10 and US$4,20 per kg.

However, Andrew Matibiri the chief executive officer of TIMB said farmers will only get a maximum of US$ 2000 in cash from the sale of their tobacco with the rest being deposited in their back accounts.

“We had wanted the farmers to get cash for all their deliveries but the Reserve Bank of Zimbabwe (RBZ) told us that they would want to encourage people to use banks. The rest of the money would be deposited in their bank accounts. I am very happy with the prices today there are quite good considered that these are primings,” said Matibiri.

He said sales will initially be conducted twice a week and on Tuesdays and Thursdays at two auctioneers the Tobacco Sales Floor (TSF) and Zimbabwe Tobacco Auction Centre (Zitac).

About 22 000 growers have registered to sell their tobacco this season, which is a reduction from the 28 000 that registered last year.

Addressing farmes at the official opening function, acting agriculture minister Ignatius Chombo said farmers should be rewarded for their efforts.

“Our tobacco is known for its good quality. There are other producers from Brazil and China, but their crop does not match ours in quality. This is a cash crop and our country’s economy will benefit a lot from the sales,” said Chombo.

TIMB chairperson Njodzi Machirori said they had to bring forward the selling season after presentations from buyers and farmers on the advantages of an early sale. In previous years the selling season was scheduled to start in May.

“The buyers said it would be beneficial to them if the selling season is brought forward. Their argument is that there will be other customers and there wouldn’t be enough cash to pay for the abundant crop on the market,” said Machirori.

He said the farmers told them that they want the sales to go on early for them to be able to pay their loans on time in order to cut on interests.

“The farmers also argue that it is very expensive to keep and maintain their crop in their warehouses than to sell it early,” said Machirori adding that it was illegal for farmers to hold on to crops from the previous season for speculative purposes.