Tobacco deliveries 49pc ahead of 2022

TIMB says about 267 million kg of tobacco worth US$812 million have been sold via contract floors while 19,7 million kg valued at US$56,8 million have been sold through an auction system.(File Picture)

Tobacco deliveries have reached nearly 287 million kilogrammes, a 49 percent increase from the 193 million delivered during the same period last year, official figures show.

By day 83, tobacco worth about US$869 million had been sold through contract and auction floors, compared to US$588 million during the same period last year, according to statistics from the Tobacco Industry and Marketing Board, which monitors activities in the tobacco sector. The average price was US$3,03 from US$3,04 per kg in 2022.

About 267 million kg worth US$812 million were sold via contract floors while 19,7 million kg valued at US$56,8 million were sold through an auction system,  TIMB said.

With production expected at 290 million kg, having been revised three times from 230 million kg and 270 million, this year’s tobacco production would be the highest ever the country has produced.

A number of factors have been attributed to the increase in output including a surge in global demand for local tobacco, favourable weather that was characterised by both dry and wet spells, better agronomy, and improved participation by the smallholder farmers who produced the crop using their own resources.

“It has been a very good season for the country and I think this will be sustained,” TIMB chairman Patrick Devenish told sister paper Business Weekly in a recent interview.

“Because of the contract scheme, the agronomy support continues growing and this had a very positive impact on the yields and the quality as well,” Devenish added.

Under the contract system, licensed tobacco buyers provide the inputs to the farmers, with the contractor—or the off-taker–guaranteeing to buy the tobacco contracted at prices (per grade) equal to or higher than those prevailing on the auction floors.

Prior to 2004, tobacco marketing was done exclusively through an auction system whereby producers mobilised the necessary cropping resources on their own and took their crop to an auction floor of their choice. However, in 2004, this system was changed after the introduction of the contract growing of tobacco.

TIMB acting chief executive Mr Emmanuel Matsvaite also said the Good rains and improved agronomy practices helped to boost tobacco production. “We also put in place some methods to reduce post-harvest losses such as ‘chigaffa’ while the early opening of the season ensures tobacco goes through formal channels,” he said.

Chigaffa is a natural air curing system that prevents farmers from losing marketable volumes due to curing ban capacity limitations. This reduces farmers’ post-harvest losses and improves farmer viability, profitability, and sustainability.

“All the measures were in the context of the Tobacco Value Chain Transformation Plan,” said Mr Matsvaire, adding that “we are satisfied with how we performed.”

At its peak, the country produced 259 million kg. Under the Tobacco Value Chain Transformation strategy, the country seeks to increase tobacco output to 300 million kg by 2025, enhance value addition and beneficiation to around 30 percent through the production of cigarettes and grow the industry to US$5 billion by 2025.

Exports reached about US$407 million during the first four-month of 2023, according to the latest statistics from the Reserve Bank of Zimbabwe (RBZ). Last year, tobacco exports were US$968 million up from US$575 million during the prior year.

Herald

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