Home » General » ZIMBABWE TOBACCO BOARD ENGAGES INDUSTRY ON PRICES

HARARE, March 31 — Zimbabwe’s Tobacco Industry and Marketing Board (TIMB) has given players in the sector up to March 30 this year to make submissions on ways to reduce the gap between prices at contract auction floors.

The TIMB introduced the dual marketing system as a measure to boost output when production dropped in the aftermath of the land reform programme as most new farmers did not have experience to produce the crop.

For years, contracted tobacco has been fetching higher prices as compared with the auctioned floors, a situation that has pushed more growers to switch to contract farming.

Poor prices dampened the opening of the 2015 selling season as prices were as low as six cents US per kilogramme at auction floors and sales were temporarily suspended after farmers protested against the wide gap between contract and auction tobacco prices.

The farmers accused merchants of colluding to undervalue their tobacco because higher prices always prevail for the contracted crop but merchants insisted that they could not pay more for low quality tobacco and also that growers had delivered lower leaves.

At present, contract farmers are paid up to 6.25 USD per kg for similar quality crop that’s fetching 4.99 USD at the auction floors.

In a letter addressed to licensed tobacco buyers, floors and contractors which leaked to New Ziana, TIMB Chief Executive Officer Dr Andrew Matibiri said the need to engage the sub-sector had been pushed by the
negative publicity received of late regarding tobacco prices.

“TIMB would like to be proactive in responding to this negative publicity. Resultantly, TIMB is soliciting for industry’s views to be reflected in this response,” he said.

Dr Matibiri said all companies must by March 30, 2015 have submitted recommendations on how the industry can address price differences between auctioned and contracted tobacco. “The responses will be collated as an industry position and other penitent matters affecting the industry,” he said.

Tobacco being marketed this year is of low quality as it was produced under an awkward and challenging environment for instance there was late onset of rains delaying the planting of the majority of the crop which
is rain-fed. Most tobacco was planted towards the end of November, with more than 60 per cent of the dry land crop planted after the first week of December.

Consequently, there were a lot of unsuccessful re-plantings and this resulted in poor crop establishment and unevenness throughout the tobacco growing areas of Zimbabwe. The crop situation was exacerbated by the incessant rains received from about the second week of December 2014.

Zimbabwe expects 190 million kg of tobacco to be sold this year, compared to 216 million kg sold last year.

SOURCE: NEW ZIANA

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