Zimbabwe: Tobacco Exports Rake In $827m

Source from:  The Herald 12/14/2017

Zimbabwe has earned $827,4 million from 166,6 million kilogrammes of tobacco exported mainly to South Africa and China since the beginning of 2017. Statistics from the Tobacco Industry Marketing Board’s latest weekly bulletin show that China accounted for over 56,3 million kg valued at $440,9 million while South Africa bought 20,9 million kg for $64,1 million.

With an estimated 350 million smokers, China has been spending over $200 million yearly on Zimbabwean tobacco. Part of the TIMB weekly bulletin reads: “As of October 27, 166,6 million kg were exported to 62 countries so far, generating $827,4 million into the local economy.

“During the same period last year tobacco exports generated $771,8 million from 136,8 million kg. The golden leaf is presently being exported to these countries at an average price of $4,96 a kg compared to $5,57 (in) the same period last year.”

Belgium has so far bought 19,8 million kg worth $59,97 million (average price of $3,02/kg), followed by Indonesia, which has spent $37,8 million on 9,04 million kg, while United Arab Emirates stands at 7,6 million kg worth $14,8 million. Other buyers include Russia, Bulgaria, Vietnam, Hong Kong, France, Netherlands, Germany, Holland, Sudan, Spain and Tanzania.

Last year tobacco exports topped $933 million, which was a marginal surge from $855 million from the previous season. During the 2017 marketing season, farmers sold 189 million kilogrammes of flue-cured tobacco, with contract farmers contributing most of the deliveries at 158 million kg, while self-financed farmers weighed in with 31 million kg.

Meanwhile, farmers have already started planting for the upcoming season. Manicaland Province is now the leading province in terms of the hectarage that has been put under flue-cured tobacco, having 10 227 hectares under the cash crop out of the 30 719 ha planted countrywide.

The TIMB bulletin showed that the 30 719ha of tobacco planted throughout the country is a 0,9 percent increase from the 29 701 ha planted in the same period last year. Given that the rains have fallen, more dry land tobacco farmers have planted and some are still planting.

Many tobacco farmers are under contract farming where beneficiaries often access inputs such as fertilisers and chemicals timely. Some contracts even cover labour costs.

Government has put in place $28 million tobacco kitty, which will ensure that the tobacco auction system remains in place as the domination of the contract system will entirely affect the tobacco sector through manipulation of the system as what happened to the cotton sector.

Tobacco registrations for the 2017 /8 season rose 36 percent to 99 448 from 73 340 last season. This shows a high appetite of growing the golden leaf among farmers. Tobacco is the country’s highest foreign currency earner followed by gold.

The central bank is considering opening the auctions floors early in a bid to ease foreign currency pressure Zimbabwe is experiencing. The Reserve Bank of Zimbabwe (RBZ) also introduced 12 percent export incentive to promote export oriented production.  Enditem