Malawi Govt Suspends Tobacco Sales

Source from:  May 17, 2006, By Frank Jomo  05/18/2006

Blantyre (AND) The Malawi government has suspended all tobacco sales following concerns from farmers that buyers were offering them peanuts. "Yes we have closed all tobacco selling points until further notice. At the moment there is no place that is operating [as a selling point], including the satellite depots," Tobacco Control Commission (TCC) confirmed to the local press. He told the Nation Newspaper that the decision was painful but that government had no option but to implement it after noting that things have been changing for the worse in recent times. He said discussions were underway between government and the buyers on the issue. Opening the tobacco sales this year, President Bingu wa Mutharika issued a directive that low tobacco grade should be fetching US$1.10 while high grade tobacco should be bought at a minimum price of US$1.70. However, from the first day of sales, buyers defied the President's order leading to disruptions at the markets. Meanwhile Minister of Agriculture, Uladi Mussa, has said government is currently hunting for new tobacco buyers for the next growing season in order to improve the leaf's price. He says the country only has a few buyers, which means that there is no competition from the buyers. "We only have three major tobacco buyers in the country and this is why they are dictating prices at our auctions," says Mussa. Tobacco is Malawi's chief foreign exchange earner, raking into the country about 60% of all foreign exchange earnings. Enditem