Zimbabwe: Tobacco Deal Gives Farmers the Creeps

Source from:  Financial Gazette (Harare) Tsitsi Shonhiwa 06/18/2004

NEW tobacco growers have expressed dissatisfaction with the contract growing scheme offered by the Agricultural Rural Development Authority (ARDA) in collaboration with Gold Driven Investments (Pvt) Limited (GDI). The government recently approved a tobacco contract growing and marketing scheme aimed at giving farmers an opportunity to acquire inputs and extension support. The new initiative has seen a dual marketing approach, with the traditional auction system operating alongside the contract scheme. Under the programme, tobacco merchants finance tobacco growers to nurture a certain hectarage of the golden leaf. The tonnage harvested would then be sold directly to the tobacco merchant who would have financed the crop. ARDA is one of the nine companies tasked by the government to operate pilot contract schemes this year. But the new farmers expressed fear that they would not benefit fully from the scheme. At a recently held tobacco exhibition, they accused ARDA of exploiting them, saying benefits for growers from the deal were minimal. The farmers insisted they preferred to finance, produce and market their own tobacco crop. The tobacco growers' concerns come barely two months after ARDA held its inaugural contract-buying scheme. The parastatal claims this first project was a big success. ARDA says it surpassed the highest price at any sale during that period. The sale produced a current seasonal price of US$2.85/kg. ARDA also says farmers received prompt payment within two hours of sale. A total of 376 bales out of 382 laid during the April sale were bought, with six bales being rejected. Enditem