Tobacco marketing progressing well

05 Jul, 2022 - 00:07 0 Views
Tobacco  marketing progressing well

The Herald

Precious Manomano
Herald Reporter
The 2022 tobacco season has progressed well with the average price being firmer because of low volumes compared to last year.

This was attributed to unpredictable weather patterns and erratic rainfalls which heavily affected production of the crop.

According to the Tobacco Industry and Marketing Board,statistics show that the average price has increased to US $3per kg this year compared to US $2,73 last year, same period.

Zimbabwe National Farmers’’ Union vice president Mr Edward Dune said there is need for sustainable production of tobacco in Zimbabwe and improvement on payment of growers by the contractors. He also said the other challenge facing the industry is the viability or drop outs of tobacco growers because of high costs that are associated with the production of tobacco.

“Some Contracting companies faced challenges which adversely affected processing of payments to farmers. Some are not paying on time hence inputs prices are high. This is affecting production of tobacco especially to small scale miners where we are seeing their dropouts because they are failing to meet production costs, ’he said.

Tobacco growers who sell through the auction floors are self-funded, they support their own tobacco production until they sell on the market. With the limitations on access to funding from the banks because of lack of collateral most farmers are now opting for contract farming. That is why tobacco sales on auction floors have declined.

This season, the Tobacco Industry and Marketing Board registered 123 595 farmers, down from the 145 625 growers for the last season, although not all registered growers actually plant anything.

The number of new growers fell from 1 916 last year to 705 this season. The bulk of the tobacco is sold through contract floors as 95 percent of the crop is grown under contract system while only 5 percent farmers are self-funded or are able to borrow money from banks.

This season, tobacco farmers are paid in three quarters of their sales proceeds in foreign currency and the remaining quarter in local currency, converted at the prevailing auction exchange rate on the day of sale. The 75 percent is paid directly into the growers’ foreign currency accounts and this is treated as free funds while the 25 percent local currency will be deposited into the growers’ local bank accounts or e-wallets. Growers were last season getting 60 percent of their money in foreign currency and 40 percent was converted at the prevailing auction exchange rate on the day of sale and paid in local currency. TIMB has licensed 33 contractors compared to 39 last year, 33 A class buyers compared to 31 last season and also licensed suppliers for wrapping paper.

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