Tobacco Sales Resume in Lilongwe

Source from:  by Taonga Sabola and Tadala Makata-Kakwesa, 31 March 2006 - 05:36:48  04/02/2006

Tobacco sales resumed at the Lilongwe Auction Floors on Thursday after discussions by industry captains on Tuesday but sales at the Limbe Auction Floors in Blantyre failed to start as planned yesterday as authorities said they wanted the Lilongwe market to stabilise before opening another one. Tobacco Control Commission (TCC) General Manager Godfrey Chapola said in an interview that the sales—which were suspended on Tuesday over disagreements on minimum prices per kg—were due to start Thursday without changes on the guiding minimum prices of $1.10 per kg for low quality tobacco and $1.70 per kg for high quality tobacco as dictated by President Bingu wa Mutharika when he opened the floors on Monday. "We've agreed to start the sales tomorrow [Thursday]. The prices still remain the same. Nothing has changed," said Chapola He said the meeting discovered that the buyers were not willing to buy the tobacco at the minimum prices set by the President had set, but he said: "Those are just guiding minimum prices. They can always change. What the President meant was that the low quality tobacco should not go below that amount and we've to restart the sales." Tobacco Exporters Association of Malawi (Team) Vice Chair Alastair Craik, who is also Managing Director of Alliance One Tobacco—one of the buyers, confirmed the agreement that sales should start but he could not say much on the prices. "We'll go to the auction and see what is on offer and we'll see whether we'll be able to buy," said Craik There was heavy security at the floors Thursday when The Nation team visited the floors. Workers were seen lining up the bales readying for resumption of the sales. In Limbe, a spot-check revealed there was no trading activity as auction officials were busy arranging tobacco bales. Chapola and Tobacco Association of Malawi Executive Secretary Felix Mkumba said the market will open on Tuesday next week. Chapola said TCC had a meeting with growers, government and buyers on Wednesday where they were discussing prospects of resuming sales at Lilongwe Auction Floors and thought it would not make sense to open another market when the Lilongwe one had not calmed down. Enditem