Zimbabwe: Poor Prospects for Tobacco

Source from:  Zimbabwe Standard (Harare) August 21, 2006 August 21, 2006 08/22/2006

DEBORAH-FAY NDLOVU THE tobacco industry says there will be no respite for the sector this coming season with 60 million kg expected to be produced. The RBZ had sought to rescue production for the coming season by introducing a host of incentives that include the 15% Foreign Currency Retention scheme but industry players said these would only bear fruit in two years. For now, said the tobacco industry, the free fall in production would continue with only 60 million kg expected to be produced in the next season. "Based on the seed sales we are looking at producing about 60 million kilogrammes. The monetary policy was only announced on 31 July and by then people had started sowing seedlings. The incentives were a bit late for the season because planning starts in January and whatever happens in the year cannot impact on production," said Tobacco Industry Marketing Board technical sales director, Dr Andrew Matibiri. He, however, said he was optimistic that production would increase in the next two years because of the incentives. Tobacco production peaked at 200 million kg in 2000 but has since been on a decline due to the shortage of critical inputs such as fertiliser, late disbursement of funds and erratic fuel supplies . This season's production is expected to drop to an all time low of 50 million kg from last season's 74 million kg. So far only 44,5 million kg have been delivered to the auction floors, ahead of the close of the selling season in two weeks with US$89 million having been earned from the sales of the crop. Last season around this time 46,2 million kg had been delivered, earning the country US$70,39 million. The development has however spurred the increase in prices with the crop fetching US$1,91 up from last season's US$1,61. Enditem