Tobacco sales inch closer to US$700m

A TOTAL of 227,3 million kilogrammes of tobacco valued at US$683,8 million have been sold by farmers across the country since the start of the 2023 marketing season in March, the latest official figures show.

In the corresponding period last year, 148kg worth US$445 million had been sold.

Statistics from the Tobacco Industry and Marketing Board (TIMB), showed that as of Friday last week, 16,8 million kilogrammes valued at US$48 million had been sold through the auction system while 210,5 million kilogrammes was sold under the contract arrangement for US$635,7 million.

Farmers process their crop before taking it to the auction flows. (Image credited to TIMB).

The average price was US$3,01 per kilogramme.

This year’s selling season opened with the Government calling for transparency among actors in the industry to eliminate farmer deprivation by middlemen while enhancing fairness and sustainability in contract and auction sales.

Production is expected to increase by 8,5 percent year-on-year, on account of incentives by the Government for tobacco farmers, which is expected to drive output to 300 million kilogrammes by 2025.

At the moment, tobacco farmers retain 85 percent of their earnings in foreign currency while the remainder is paid in local currency.

Last year, the farmers were paid 75 percent in hard currency while the balance was in Zimbabwe dollars.

Through the Tobacco Value Chain Transformation Plan, Zimbabwe aims to grow the industry into a US$5 billion economy by 2025.

The country anticipates producing 230 million kilogrammes of the golden leaf this marketing season, up from 212 million kilogrammes realised in 2022.

Tobacco is Zimbabwe’s agricultural major foreign currency earner after raking US$800 million in 2021.

The output has grown from 48 million kilogrammes in 2008 to over 200 million presently, and the bulk of the crop is produced by small-scale farmers.

At present, only 18 percent of the crop is grown under irrigation, and the intention is to expand this to at least 40 percent.-chronicles