Farmers Stuck With Excess Tobacco

Source from:  New Vision (Kampala) Sylvia Juuko And Kyetume Kasanga 01/18/2005

ABOUT 5,000 tobacco farmers in Masindi are stuck with surplus crop due to failure by cigarette manufacturing companies to buy it this season. Masindi district chairperson John Majara said farmers have about 720 tonnes of unsold tobacco and petitioned the Government to intervene and have their crop bought. For a YEAR IN REVIEW excerpt from the Africa 2005 guidebook, click here. (Adobe Acrobat). To buy the book, click here. Majara said the farmers plan to sue British American Tobacco Uganda (BATU) for breach of contract. "BATU breached trust after giving out loans and signing contracts with farmers. It is unbothered about the loans because it has already recovered its money from elsewhere," he said. BAT officials said they are aware of the excess tobacco, but the company couldn't buy any more because they met their contractual obligations and surpassed their targets. Patrick Rose, out-going BATU area leaf growing manager, said while an excess of 2 million kilos of tobacco was bought from Bunyoro-Mubende, they couldn't sell it due to the glut in the international market. "We agreed with farmers to buy 14.6 million kilos of flue-cured tobacco at the end of the season last month, but bought 16.5 million kilos, which is about 2 million kilos of additional tobacco," Rose said. He said loan recovery in Masindi was at 82%, meaning BATU had about sh800m un-recovered. Enditem