Zimbabwe: Contracted Tobacco Market Share Rises

Source from:  The Herald 08/20/2014

Continued delivery to merchants after closure of auction floors has seen the market share for contracted tobacco marginally rise from 76,1 percent to 76,4 percent of total production for this year, the Tobacco Industry and Marketing Board has said. During the same period in 2013 contractors had accounted for 67,5 percent of total production against 32,5 percent of auctioned tobacco.

In its weekly bulletin, the TIMB said seasonal total sales stand at 215,1 million kilogrammes, up from at least 164,3 million kilogrammes sold during the same period in 2013 at an average price of $3,69 per kg.

TIMB chief executive officer Dr Andrew Matibiri told New Ziana that an increase in tobacco produced this year is attributed to orderly marketing which lured thousands of farmers to leave other crops.

"The increase in tobacco output from 166,5 million kg in 2013 to 215 million kg can be attributed to the straightforward marketing system used as farmers are paid per every delivery."

"Also tobacco pays a lot so farmers are shifting because other crops like cotton and maize are failing to meet growers' price expectations yet for the golden leaf we have a ready market both locally and internationally," he said.

The tobacco sector has been on a rebound as 106 455 growers registered for the 2014 season compared to about 91 278 who had registered by the same period last year.

Dr Matibiri said contractors also played a role in the production of more tobacco this season.

"Contractors have been supplying inputs such as fertilizers to farmers and this has seen a boost in national tobacco production," he said.

Zimbabwe Commercial Farmers Union president Wonder Chabikwa however said low prices were affecting farmers this season.

"Buyers reduced prices to $3,17 per kg due to demand and supply principle in which they lowered it to maximize their profits after seeing a boom in tobacco grower base," he said.

Tobacco is one of Zimbabwe's major agricultural exports, accounting for 10, 7 percent of gross domestic product and 40 percent of all exports. Enditem