Tobacco First Bale Fetches US$5 Per Kg

Source from:  Zimbabwe Herald 05/08/2009

THE 2009 tobacco selling season got off to a promising start at the Tobacco Sales Floor in Harare yesterday with the first bale fetching US$5 per kg, much higher than last season's average of US$3,21 per kg. The season opened without the "traditional" hiccups of the last four seasons: farmers' protests over the exchange rates and cash pay-outs. Most bales averaged US$3,40 and US$3,80 per kg with a few fetching around US$2,50 and some below US$1,90 per kg. A total of 1 200 bales were laid at TSF. The prices compare favourably with those in the leading tobacco producing country, Brazil - between US$4,10 and US$4,20 per kg. The sales were conducted under heavy police presence with the officers determined to protect farmers against swindlers. Bank officials on the floors said they were ready to give the farmers cash for their produce. "We believe we have enough cash to meet the US$1 500 pay-outs to the farmers," said one bank official. "Our only concern is that farmers should open Foreign Currency Accounts with bankers of the companies operating the floors to ensure transfers above the cash pay-outs are done promptly," said the official. Farmers would this year receive US$1 500 in cash with remainder being deposited into their FCAs. Cash pay-outs are supposed to be done within one and a half-hours after sales end. Last season farmers were forced to spend days at the floors as they waited to cash their cheques.The cash available was enough only for transport to and from their farms. Deputy Minister of Industry and Commerce, Mr Mike Bimha who officially opened the season, urged the farmers to co-operate with Government to resuscitate production. He said while Government was making concerted efforts to ensure the availability of inputs to farmers, the onus was on the farmers to ensure that they did their part by utilising the proceeds from the sales to procure inputs. The minister hailed the contract system's role in financing tobacco production. He said the contract system accounted for 23 percent, but was now up 67,7 percent. He called on farmers to focus, not only on boosting production but also on improving the quality of the crop. Agriculture, Mechanisation and Irrigation Development Minister, Dr Joseph Made and Regional Integration and International Co-orporation Minister, Priscilla Misihairambwi-Mushonga, attended the opening. Farmers were naturally elated with the way the first day had gone. Zimbabwe Commercial Farmers Union president, Mr Wilson Nyabonda said he was confident the season would be better than the previous one. He was confident farmers would be able to go back to the fields for the next season. Tobacco Growers' Trust chairman, Mr Wilfanos Mashingaidze welcomed the opening prices, but called on merchants to ensure they offered farmers prices that would enable them to return to their fields. He called on farmers to ensure they spent their earnings on productive items. "If farmers plan prudently for the next season, it will be easier for us to achieve 120 to 160 million kg in the next harvest than if they didn't plan properly." Mr Mashingaidze said the payment in US dollars would enable farmers to recover from the losses they incurred last season when they received bearer's cheques whose value was eroded by inflation. Mr Markhim Kaitano of Goromonzi said since this season looked brighter he wanted to buy farm equipment for easier seedbed preparations. Mrs Susan Meki of Bromley near Marondera said he expected high prices that would enable them to break even. "We bought fertilizer at very high prices and we should recover the costs," she said. The growers hailed the fertilizer industry for reducing prices and making the product more readily available. Fertilizer prices were recently slashed: 50kg bag of Ammonium Nitrate or Compound D to US$29 from US$40. Tobacco Sales Floor Limited's managing director, Mr Philemon Mangena said they were very encouraged by the opening prices. "We believe the adoption of multiple currency system should provide the impetus for farmers to increase production. "We are also very encouraged that deliveries are early and all indications are that we are going to have a good season," he said. At least 42 million-kg are expected to be delivered to the floors this season. The selling season is expected to end well within 80 selling days or at the latest by Friday 28 August 2009. Enditem