Tobacco sales up 10 percent

At least 212,71 million kilograms of tobacco worth US$650,30 million have been sold so far at auction and contract floors in the country since the start of the selling season this year, statistics from the industry regulator show.

Tobacco production is a key economic activity for small-scale farmers. The small-scale tobacco growers at its core are dependent on contract programs since they are unable to fund themselves.

Due to unreliable rainfall patterns this year, experts say most farmers did not get the expected yields. Therefore, it is likely that those in credit will not be able to settle their loans, leaving them in credit.

After gold, tobacco is the country’s second-largest single source of foreign exchange earnings; the two biggest markets for the golden leaf are China and South Africa.

The United Arab Emirates, Indonesia, and Belgium are some of Zimbabwe’s other major exporters of tobacco that has been flue-cured.

In a trading update for day 124, the Tobacco Industry and Marketing Board (TIMB) said sales had increased by 10,30 percent from the US$589,57 million recorded in 2021.

“The increase in tobacco sold as well as the value is evidence of our efforts as an industry to establish a US$5 billion industry by 2025,” said TIMB.

Through the tobacco transformation plan, the country wants to create a US$5 billion tobacco industry by 2025.

Under this plan, tobacco production will be improved to 300 million kilograms of the good quality desired by international markets.

The final tobacco sale for the 2022 tobacco marketing season took place on October 21, 2022.

“Therefore, all contract and auction floors are closed.”

The average price for the auction and contract floors stood at US$3,06 per kg, which is 9,47 percent higher than the US$2,79 of the 2021 marketing season.

The crop has so far fetched the highest price of US$6,80 per kg while the lowest was at $0,10.

Rejected bales declined to 77,116 from 88,364 in the same period last year.

This year’s tobacco marketing season saw the first bale being sold at US$4,20 a kilogram, which is marginally lower than the US$4,30 a kilogram in 2021.-ebusinessweekly