Tobacco sales reach US$383,1m

ZIMBABWE’S tobacco sales have reached US$383,1 million as of day 62, representing 8% growth compared to the same period last year, data from Tobacco Industry Marketing Board (TIMB) has shown.

During the same period last year, the golden leaf fetched US$353,3 million.At least 155,8 million kilogrammes have been delivered at the floors down from 187,1 million kg last year.
Auction floors continue to trail behind after accounting for US$21,79 million in sales way below US$361,3 million amassed by contract floors.

This year, there are 31 contract floors registered to buy tobacco and three auction floors.

Established in 1936 through the Tobacco Marketing and Levy Act, the auction floor system was for years the only platform where tobacco was sold in Zimbabwe, but the contract system made its debut in Zimbabwe in 2004 and has been gaining ground ahead of the auction floors.

Average price has surged US$0,57 to US$2,46 per kg from US$1,89 per kg reported last year.

This year’s tobacco season commenced on April 29 after several deferments as authorities grappled with measures to contain the spread of the global COVID-19 pandemic.

Since the commencement of the selling season late April, farmers have been getting 50% of their earnings at a fixed rate of US$1:$25 at a time the parallel market rate has been running amok.

As such, farmer associations have so far lobbied in vain to be paid fully in hard currency, with some pushing authorities to effect an exchange difference payment at an agreed
rate.

Tobacco is one of the country’s top forex earners, which has helped shore up proceeds needed for the importation of industrial raw materials, fuel and pharmaceuticals among others.

Previously a preserve for white commercial farmers, tobacco farming in Zimbabwe has, over the years, grown to become the mainstay for smallholder and subsistence farmers, providing a source of livelihood for most of the country’s rural population.

TIMB projects this season’s output at 225 million kg compared to an all-time high of 259 million kg last year.

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