Zimbabwe: Tobacco Selling Season Rakes in Us$98,3m

Source from:  The Herald (Harare) August 28, 2006 08/30/2006

THE country has so far earned US$98,3 million from 49 million kilograms of tobacco that have gone under the hammer, with the selling season most likely to be extended after day 84 of trading as of Friday last week. The selling season may be extended due to huge supplies being registered at the auction floors as the original due date nears. The tobacco selling season opened on April 25 and was scheduled to close on August 31. During the comparative selling period last year a total of 53 million kilogrammes had been sold earning the country US$83 million. This year, contract farmers have sold tobacco worth US$57 million at the auction floors bringing in US$41,3 million. Contract farmers sold a total of 27 million kilogrammes with the auction floors selling a total of 22 million kilogrammes of flue-cured tobacco. Tobacco sales are poised to surpass the predicted 52 million kilogrammes that would rake in US$100 million, with four trading days before the end of the normal selling season. According to TIMB statistics, the "golden leaf" was selling at US$2,02 per kilogramme last week. Of the total tobacco auctioned, the Tobacco Sales Floors (TSF) has accounted for the lion's share having sold 9 959 003 kilogrammes. Burley Marketing Zimbabwe (BMZ) auction floors have handled 6 419 035 kilogrammes, while Zimbabwe Tobacco Auction Centre (Zitac) has traded the least quantity at 5 195 343 kilogrammes to date. TIMB said that tobacco supplies are still very strong raising the possibility that the August 31 deadline could be extended. "If delivery remains very strong, we will continue selling and there will be no penalty imposed on those farmers who may deliver late. "This will be an extension of the normal selling season and the clean-up period will be in late September," said TIMB technical sales executive Dr Andrew Matibiri in an interview. At least $12 billion has been paid out under the normal and early delivery bonus schemes. Contract farmers dominate the market share with 55 percent. TSF controls 21 percent of the market while BMZ enjoys 13 percent. Zitac accounts for a 11 percent stake. BMZ caters for medium to large-scale tobacco growers, Zitac attracts large-scale growers while TSF mainly accommodates smallholder farmers. TIMB said that the crop being delivered is of good quality and the firm prices are encouraging supplies. Experts observed that around 90 million kilogrammes of the "golden leaf" would be produced in the 2006/7 season if inputs are disbursed timeously. Enditem