Tobacco remains king

17 Feb, 2017 - 00:02 0 Views
Tobacco remains king Tobacco Prices

The ManicaPost

Rumbidzayi Zinyuke Syndication Writer
Zimbabwe’s tobacco industry continues to present a strong front despite challenges that range from high cost of production, low prices as well as a looming global ban on tobacco production.

While most of the problems being faced in the sector are not peculiar to tobacco only, the crop has maintained its dominance with a significantly high number of farmers opting to grow the golden leaf.

There is no denying that the growth in grower numbers has been phenomenal over the past decade.

According to a Tobacco Industry and Marketing Board report, a total of 82 110 growers had registered for the 2016/17 season as at 3 February, a 16,5 percent rise from 70 501 growers who had registered in a corresponding period in the prior year.

Of this figure, 14 841 were new registrations.

TIMB also says more than 100 000 hectares of land  have been put under tobacco so far from about 95 160  hectares that had been planted during the comparable period last year.

It hasn’t just ended with the increase in growers and the hectarage being put under tobacco. The crop’s contribution to the fiscus has grown significantly earning the country more than $700 million in export revenues last year.

It contributes about 30 percent of total exports and nearly 10 percent of GDP to directly benefit more than a million people.

However, the sector hasn’t been without its share of troubles. Dissatisfied farmers have in the past accused cartels of unscrupulous buyers operating at auction floors of manipulating prices.

In 2009, flue-cured tobacco prices averaged US$2,98/kg before dropping slightly to US$2,88/kg in 2011 and further retreating to US$2,73/kg in 2012.

But the price gained momentum to close the 2012 season at US$3,65/kg and grew further to US$3, 67 per kg in 2013.

In 2014, the average tobacco price dropped to US$3,17/kg before tumbling further to US$2,93/kg last season.

But contract farmers have enjoyed good prices, some as high as $6,25 per kg in the last season.

And some of those selling their tobacco on the floors have been less fortunate, getting prices as low as $0,10 per kg.

But TIMB corporate communications manager Isheunesu Moyo says low quality tobacco fetches low prices while good quality fetches good prices.

“This year our target is to improve the quality of tobacco that farmers are producing,” he said.

He said the incessant rains that were experienced in the country have presented problems of leaching, water logging and early ripening of crop.

“But farmers are already getting support and are being told to apply ammonium nitrate once they notice signs of early ripening,” he added.

This will ensure that this season’s crop is not affected too much by the excess water.

Challenges aside, the sector still supports thousands of families who have been eking a living from tobacco farming.

So what is it that has made tobacco retain favour with most farmers?

We cannot deny that tobacco is by far the most organised, profitable crop in Zimbabwe.

The growth in the sector shows the impact of funding that has over the years been availed to tobacco farmers. The marketing of the crop and the payment modalities have also made it a crop of choice for many farmers who moved from other crops such as cotton, maize and wheat, among others that have not been profitable over the years.

With the level of organisation in that sector, it is only logical that banks tend to prioritise funding such a venture which is guaranteed to give them their money back.

The same cannot be said for cotton and maize just to name two.

For years, cotton farming has been on a downhill as the sector was characterised by a lot of side marketing and very low prices. Such low levels of organisation did little to enhance the value chain which has all but died.

With maize, the payment of grain from the Grain Marketing Board became irregular which meant farmers had to endure a very long wait before they could get payment for their crop. This also affected the value chain and encouraged a lot of importation.

It is only now that government has introduced schemes meant to boost production of cotton and maize. If they record the anticipated success, it might signal the beginning of the end for the tobacco boom.

We might begin to see the same smooth processes in the production of other crops that we see in tobacco.

If there is an effective stop order system that ensures that once a farmer is paid for their produce, the bank gets its share from it, then we might also see more funding towards those crops.

But for now, the golden leaf remains king! – Zimpapers Syndication.

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