Tobacco season opens with price increase, but drought cuts production
The 2024 tobacco marketing season kicked off today with a positive sign: the first bale sold at US$4.92 per kilogram, a slight increase from last year’s opening price of US$4.35.
However, this positive development is overshadowed by a significant decline in expected output due to drought conditions.
Last year, farmers produced a record-breaking 296 million kilograms of tobacco. This year, production is expected to fall to roughly 235 million kg as the El Niño weather phenomenon brought drought to most farming regions.
The drought’s impact is further reflected in shrinking hectarage and grower numbers. Planted tobacco land has decreased from 117,645 hectares last year to 113,101 hectares this season. Additionally, the number of registered tobacco growers has dropped by 22 percent to 115,114.
“The tobacco sector was not spared by the drought,” said Tobacco Industry and Marketing Board (TIMB) chairman Mr. Pat Devenish at an event marking the official opening at the Tobacco Sales Floor in Harare.
“The negative variance was due to delayed rains, which affected the planting of dryland crops. The late rains also caused delayed crop establishment for small-scale farmers, who contribute 70 percent of the national yield. Consequently, there was a decline in volume produced per hectare.”
Zimbabwe’s tobacco industry is the country’s second-largest foreign currency earner after gold and is mainly produced by small-scale farmers who benefited from the land reform program that began in early 2000.
Under the country’s Tobacco Value Chain Transformation Plan, Zimbabwe aims to transform the tobacco value chain into a US$5 billion industry by 2025. This will be achieved through increased production and productivity, reaching an annual output of 300 million kilograms, localizing tobacco production financing, value addition and beneficiation, cigarette exports, employment creation, and raising household incomes, among other initiatives.
The auction floors opened today, with contract sales starting tomorrow. According to the TIMB, about 93 percent of tobacco is financed under contract schemes.
Meanwhile, Zimbabwe will be hosting the World Tobacco Africa conference from May 15 to 16. World Tobacco Africa will feature the all-new Africa Leaf Tobacco Conference alongside an exhibition for industry suppliers.-ebusinessweekly
