Malawi's Tobacco Revenue Plunges 70% in Second Week of Sales

Source from:  Bloomberg 04/15/2009

Malawi, Africa's biggest producer of burley tobacco, earned 70 percent less from sales of the leaf in the first two weeks of this year's auctions, the Tobacco Association of Malawi said. Revenue dropped to $7.1 million in the period ended March 30, compared with $23.6 million a year earlier, the state-owned association said in a statement published in the Blantyre-based Nation newspaper today. Tobacco, which accounts for 60 percent of Malawi's export earnings, has been selling at an average price of $1.22 per kilogram (2.2 pounds), compared with the $2.15 a kilogram for burley and $3.09 a kilogram for flue-cured tobacco set by the government as the minimum price for the leaf. Malawian President Bingu wa Mutharika has given buyers until tomorrow to improve prices or face deportation. The southern African nation started setting minimum prices two years ago to spur revenue for the leaf after it accused merchants of paying growers too little for their crop. Dealers denied they underpaid farmers. Buyers have blamed poor leaf quality for this year's lower prices. Enditem