Zimbabwe: Government Pays Over $3,9 Trillion to Tobacco Farmers

Source from:  The Herald (Harare) 22 August 2007 08/23/2007

Government has so far paid out more than $3,9 trillion to tobacco farmers in support price for flue-cured tobacco deliveries to the country's three auction floors. According to figures released by the Tobacco Industry and Marketing Board, farmers have received a total of $3 946 129 713 799 against $12 billion for 2006.The money was paid out against the delivery of 63 million kg of flue-cured tobacco to the floors since the beginning of the marketing season on April 24. About 45 million kg were sold during the same period last year.The tobacco, which is worth US$147 million, was sold at an average price of US$2,34 per kg. This week alone, $30,6 billion in Government support price was paid out by Monday against 480 546 kg of flue-cured tobacco sold at the floors, fetching US$1,2 million at an average price of US$2,39 per kg. This compares well with the $329,7 million paid out in Government support in 2006 for 804 319 kg that fetched US$1,6 million at an average price of US$2,05 per kg. The support price was hiked recently to $55 000 per kg from $40 000, calculated on a pro-rata basis benchmarked on US$1,50 per kg.Government introduced the support price facility last season to encourage tobacco deliveries to the auction floors and to avoid a repeat of stalemates in past seasons when farmers refused to deliver the "golden leaf" in protest over "low" prices. An estimated 80 million kg of tobacco are expected to go under the hammer this year, significantly higher than the 55 million kg sold last year. Enditem