Zimbabwe Chaos At Tobacco Auction Floors

Source from:  The Herald 05/03/2011

THERE was chaos at the country's two main tobacco auction floors in Harare yesterday when farmers protested against poor prices that slumped to as low as US50 cents per kg, bringing business to a halt. Tempers flared at the Tobacco Sales Floor and Boka Tobacco Floors after prices tumbled to between US50 cents and US70 cents, figures farmers described as "daylight robbery and sabotage". Some farmers alleged that some buyers had run out of money and started offering low prices. At TSF, sales were suspended as farmers refused to sell their crop at the going prices and started shouting at buyers while others threatened violence. Some angry farmers started singing in protest, before storming the TSF offices demanding to see management. Management hastily organised a meeting with the farmers to quell the situation but most farmers demanded to see the Minister of Agriculture, Mechanisation and Irrigation Development Dr Joseph Made. Farmers said due to the low prices being offered, they were no longer able to pay transporters who had ferried their crop to the floors. The farmers said it was disturbing that prices were coming down when the quality of the leaf being delivered had improved significantly. However, the price of tobacco in the country is affected by international demand. On average, the international price of flu-cured tobacco per kg is hovering around US$2,83. Hurungwe farmer, Mrs Judith Goredema, said buyers should stop buying the crop when their resources were dwindling. "It is better for auction floors to close and open when buyers have enough cash to buy tobacco from farmers. Buyers are ripping us off and Government should quickly intervene to help the situation," said Mrs Goredema. She said the land reform programme was more successful in the tobacco sector and it needed more support and fair play. Minister Made said it was not correct that buyers lowered prices deliberately. "I want to warn buyers against lowering prices when they do not have money. Tobacco should be bought according to quality. "Buyers should not manipulate prices. On the other hand this is a market and farmers have their rights. It is every farmer's right to withdraw his/her crop if they do not accept the offered price at the auction floor," Minister Made said. He said tobacco growers, most of them being small scale, worked hard to grow the crop and they needed be rewarded. "We do not want to see buyers imposing further sanctions on farmers. I hope the three auction floors continue to serve farmers efficiently and there is need for more auction floors to ease congestion," he said. Gokwe farmer, Mrs Lydia Chikwaya said she had spent a week at the floors only to get an insignificant amount of money for her crop that she struggled to produce. "Can you imagine I am buying a loaf of bread for US$1 and a kilogramme of tobacco is selling for less than US$1. I have to sell two beasts so that I pay for labour and this means I will not be able to produce tobacco next season," she said. Mr Phillip Sauso of Rusape, said he sold his eight bales for US$49 and this was a mockery to the industry. TSF managing director, Mr James Mutambanesango, yesterday confirmed that prices declined. "Since last week the prices have been generally low and this has been caused by some major buyers who have not been very active on the market," he said. The Chinese are the major tobacco buyers in the country. He, however, said what the farmers did was illegal since according to the Tobacco Industry and Marketing Board Act, farmers were not allowed to collectively boycott prices. "A farmer is allowed to reject the offered price but collective action is illegal," he said. BTF managing director, Ms Rudo Boka, also confirmed the low prices but attributed it to market forces. She distanced BTF from the low prices that were being offered by buyers, saying BTF was only an auction floor, which facilitated business between farmers and buyers. According to Ms Boka, auction floors used to open in April when demand for tobacco would be high internationally. "When there is high demand on the market, prices increase and when there is less tobacco on the market, the price also increases," she said. Tobacco Association of Zimbabwe president, Mr David Guy Mutasa, said tobacco prices were determined by the quality of the leaf. High quality is attained because of good crop management practices. He, however, said buyers could form syndicates and decide prices. "Buyers may want to buy the crop at low prices. It is difficult to determine prices at the auction floors since buyers control and manipulate the system. "Farmers should know that tobacco is not a controlled crop and they can hold on to their crop and sell when prices are conducive." For the past few years, farmers have been experiencing problems marketing their produce be it cotton, maize and tobacco among other crops. Maize farmers have for long been complaining over late payments by the Grain Marketing Board while cotton growers complained of being ripped off by contractors, while tobacco farmers have nowhere to sell their crop and the prices and the payments systems, analysts say leave a lot to be desired. Unlike maize and wheat which are controlled crops, prices of cash crops such as tobacco and cotton are determined by international market forces. The prices fluctuate depending on demand on the international market and the quality of the tobacco. Enditem