Support Price Hiked, But Fresh Problems Stall Deliveries

Source from:  tobaccojournal.com 02 Aug 2007 08/03/2007

The government this week raised the support price to Z$ 55,000 per kg from Z$ 40,000, but operational problems stall tobacco deliveries. Tobacco deliveries to Zimbabwe's auction floors slumped from 1 million kg to 700,000 kg in the past week owing to operational challenges, The Financial Gazette established last week. Tobacco Industry and Marketing Board (TIMB) chief executive officer Andrew Matibiri said although prices remained firm, deliveries slowed down because of a shortage of tobacco wrapping paper due to the failure by Hunyani Paper and Packaging to get the import component on the paper. Diesel and frequent power cuts have also been a major challenge, Matibiri said. To date, deliveries of flue-cured tobacco stand at 56.3 million kg, with 80 million kg expected at the end of the season in September. The season's average selling price of flue-cured tobacco has been at USD 2.32 per kilogramme, an increase of 20 per cent from last year's USD 1.92 per kilogramme. The government introduced the support price facility – which is calculated on a pro-rata basis benchmarked on USD 1.50 per kg – last season to encourage tobacco deliveries to the auction floors and to avoid a repeat of stalemates in past seasons when farmers refused to deliver their tobacco in protest over low prices. Enditem