Malawi's Sales Season Turns Sour

Source from:  tr.itsmyiq.com May 16, 2008 05/19/2008

Malawi's leaf tobacco industry is described as being in turmoil after a good start to its sales season turned sour. Selling started in March with prices in Lilongwe reaching a high of $11 per kg on the first day, a level that the Inter Press Service described as 'phenomenal'. However, by day two prices were said to have fallen to between $2.30 and 60¢ per kg. According to Malawi's ministry of agriculture, it costs the average tobacco farmer $1 to produce one kg of the crop, whereas average prices in recent years have fluctuated between 70¢ and 90¢ per kg. This has placed a burden of perpetual debt on farmers, who have been unable to settle loans to purchase farm inputs. Most farmers are said to have cut tobacco production while some have diversified to other economic activities. Sales on all four of Malawi's auction floors were suspended on April 14 after violence broke out at the Mzuzu auction floors as farmers stopped buyers from continuing with sales. Sales resumed during the last week of April. Enditem