Tobacco Sales 2007: What's in Store for Farmers?

Source from:  by Taonga Sabola, 01 March 2007 - 03:54:42  03/11/2007

Tobacco growers in the country will live to remember the year 2006 not because of the quality crop produced because of the fertiliser subsidy programme implemented by government which enabled them to buy the soil nutrient at lower prices but because of nose-diving prices that characterised the crop's sales. For about five years now, tobacco prices have been on a downward trend with the situation getting worse with each passing year. From March 26, the country's tobacco auction floors will open to business for the farmers to sell their leaf and, of course, see what is in store for them this time around. In random interviews with Business Review, growers who are currently busy grading and curing their crop in readiness for the new season, said they are keeping their fingers crossed and praying for a sudden change of heart from the buyers whom they have often accused of giving them a raw deal. One of tobacco's big tobacco farmers, Sebastiano Kabela Phiri from Kasungu, said in an interview on Monday he was "very hopeful" of getting a good price from the auction this time around. "This year's tobacco crop looks excellent basically due to good rains. I think the buyers will have no excuse this time," he said. Senior Chief Lukwa of Kasungu, speaking in his capacity as chairman of the Linyangwa Farmers Trust, agreed with Kabela Phiri saying the farmers have very high hopes of getting good returns from tobacco this year. "We anticipate that this year's tobacco sales will be good mainly because of two reasons. Firstly, other countries like Zimbabwe have not produced in good quantities because of the situation in that country and secondly because we have less of the crop this year on the local scene against more buyers on the market," he said. Preliminary crop estimate figures released by TCC on February 1 this year show that unlike last year when the country registered a total tobacco production of 158 million kilogrammes, Malawi is poised to get 141.97 million kilogrammes of the leaf this year. This years estimated tobacco production figure is 16.3 kilogrammes less than last year's production and also falls short of the 170 million kilogrammes demanded by buyers. Civil Society Coalition on Agriculture executive director Victor Mhone warned last month that reduced production levels may not necessarily translate into improved prices. "It is very hard to predict that we will have improved prices this year. In fact, the country has not been able to meet the required levels of production by the buyers. "Basically, the production levels have plunged because of poor prices. Unless something is done to improve the prices more farmers will walk out," he said. This year government has thrown in almost every trick left in its book of solutions to rescue the sinking tobacco ship. Among other things, it embarked on negotiations with buyers, hunted for new buying companies to tighten competition and lobbied for a collective marketing strategy with neighbouring countries like Mozambique, Zimbabwe, Zambia and Tanzania. However, from the look of things very little effort has been put in place to address the problem of lack of value-adding which some quarters say holds the key to the resurrection of tobacco. With value-adding, it has been said, tobacco yields over 100 times more than the raw tobacco the country has been exporting throughout. So, for farmers like Senior Chief Lukwa, Kabela Phiri and even government, the solution is more than just keeping fingers crossed and playing the 'let's wait and see' game. Rather, investments should be made in value-adding to improve earnings. Enditem