Tobacco earnings down 24%

 

Revenue from tobacco, the country’s top forex earner, declined by 24 percent after 17 weeks of tobacco sales and a day before the 2017 tobacco marketing season closes.

Figures from Tobacco Control Commission (TCC) indicate that the country has so far raked in K153.8 billion ($209.8 million) from 105 million kilogrammes (kg) of tobacco sold since the market opened, which is down from the K201.5 billion ($276 million) the country earned from 195 million kg the same period last year.

Tobacco is Malawi’s top forex earner

In terms of volumes, there is a 46 percent decline sold so far.

In week 17, the average price was $2 (K1 460) as compared to $1.56 (K1 139) during the same period, previous year.

While it was estimated that Malawi produced about 124 million kg of tobacco against traders’ required demand of 151 million kg, TCC acting chief executive officer David Luka said this year’s tobacco output has been lower than the estimated figures.

He said while all the floors have closed, Mzuzu extended its marketing season from Friday last week to today to allow for sales of the few remaining tobacco that was in stock at the floors.

With the extension, this year’s marketing season will close at 18 weeks, making it one of the shortest marketing seasons compared to the 24 weeks that the sales normally last.

Luka has described this year as one of the best with the shortest period, better prices and less disturbances despite stiff competition on the market from four traditional buyers.

“We are making sure that we should not overproduce this year by discouraging side growing where growers exceed their quotas,” he said.

Luka added that TCC has embarked on garden mapping to have the exact sizes of tobacco farms in the country, saying the exercise has already been conducted in Mchinji, Dowa and Ntchisi, among others.

Tobacco Association of Malawi (Tama) chief executive officer Mathews Zulu is on record as having said that tobacco farmers are looking at how to sustain this year’s trend, saying “the prices are better because we produced lower volumes than the required demand as most farmers shifted from tobacco to other crops such as legumes”. n

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