Zimbabwe: Tobacco Selling Season Opens

Source from:  The Herald 02/21/2010

THE 2010 tobacco selling season begins today, two months earlier than the traditional opening, amid high hopes that the crop will contribute significantly to the Gross Domestic Product this season. Sales will initially be conducted twice a week on Tuesdays and Fridays with two auctioneers -- the Tobacco Sales Floor and Zimbabwe Tobacco Auction Centre. Tobacco contributed 26 percent to GDP last season and this year it is expected to be much higher. A total of 77 million kg of the golden leaf is expected to go under the hammer this year, up from 42 million kg last season. About 45 percent of this is scheduled to go under auction with the balance being sold under contract. Contract sales are set to commence tomorrow. As of yesterday morning, the two floors had received a total of 600 bales although Tobacco Industry and Marketing Board chief executive Dr Andrew Matibiri was optimistic that the figure would rise to above 800 bales. Farmers are expected to get better prices for their crop this year because of an envisaged global shortage stemming from hailstorm damage of tobacco in Brazil. About 22 000 growers have registered to sell their tobacco this season, which is a reduction from the 28 000 that registered last year. However, the figure is expected to rise to the 2009 levels of 28 000 farmers as the season progresses. At least 22 companies have been licenced to purchase tobacco for export and 14 have been classified as "B" class buyers -- those that can buy tobacco but cannot export it. The early opening of the season is expected to assist farmers repay their loans ahead of time, thus cutting down on interest payments. This will also assist early preparations for the coming season. This year tobacco farmers managed to put 65 202 hectares under the crop despite a myriad of challenges which included a shortage of working capital and inputs. Save for US$120 million that was provided by CBZ Bank, most commercial banks failed to assist farmers with money, leaving them to use their own resources. Meanwhile, acting Agriculture, Farm Mechanisation and Irrigation Development Minister, Dr Ignatius Chombo says that Government is encouraged by the rebound in tobacco production following a 20 percent increase between 2008 and 2009 from 48,8 million kg to 58,6 million kg. He was speaking during a pre-season luncheon to mark the opening of the marketing season. He said Government is calling on private participation in the upcoming season in order to achieve the 75 000 hectares targeted for the 2010/2011 season which would require US$600 million. "In this regard I call upon all tobacco-contracting companies to urgently make arrangements for the provision of inputs, financing and extension support to farmers to a win-win basis in time for the season. The need to formulate strategies to rapidly increase production and productivity levels and to regain the lost market share cannot therefore be over-emphasised," said Dr Chombo. Enditem