Tobacco Marketing Season Opens; Farmers To Get 75% of Sales Proceeds in Forex
HARARE: Zimbabwe’s 2022 tobacco auction season officially opened Wednesday with good quality tobacco leaf expected this year.
The highest price was 4.60 U.S. dollars per kg, slightly up from 4.30 dollars last year. 360p geselecteerd als afspeelkwaliteit
Officially opening the marketing season in Harare, the capital of Zimbabwe, Lands, Agriculture, Fisheries, Water and Rural Development Minister Anxious Masuka said better quality was expected despite the difficult weather conditions experienced this season.
Masuka said given the importance of the tobacco value chain in Zimbabwe’s economy, the government is aiming to create a conducive environment for tobacco growers and the industry at large to boost output.
“Tobacco remains a key crop for the country’s economy, contributing exports of more than 1.2 billion U.S. dollars, but this excludes the indirect economic activities that are associated with providing services related to production, logistics, marketing and exporting the crop,” he said.
According to the official, this year tobacco farmers will be paid 75 percent of their sales proceeds in foreign currency, up from 60 percent last year.
In addition, the government is spearheading the Tobacco Value Chain Transformation Plan that aims at transforming Zimbabwe’s tobacco value chain into a 5-billion-U.S.-dollar industry by 2025. The plan, which was availed last year, focuses on increasing primary production to 300 million kg by 2025, localizing financing for small-scale producers, and increasing value addition from 2 percent of total tobacco produced to more than 30 percent.
Tobacco is Zimbabwe’s second foreign currency earner after gold, with China and South Africa being the major buyers of the golden leaf.
Last year, the southern African country sold 211 million kg of tobacco leaves.
The bulk of the crop is sold through contracts as 95 percent of the crop is grown under a contract system while only 5 percent of farmers are self-funded or are able to borrow from banks.