Tobacco growers expect good prices

Tobacco growers in the country have expressed optimism in the crop fetching good prices at the auction due to low supply of the leaf as most areas have experienced pro-longed dry spells.

The sentiments follow the first tobacco assessment which estimates a 12.8 percent drop in tobacco production this year against the required demand of 171 million kilogrammes (kgs).

In random interviews, growers said flue-cured tobacco will fetch not less than $3 (about K2 190) and burley, not less than $2.80 (about K2 044) per kg.

One of the growers, Thomas Paul said he was hopeful to realise profits during this year’s marketing season compared to last year, when he made a loss.

“Production is low this year, so we anticipate good prices. Last year, the season was disappointing because of oversupply,” he said.

In an interview, Tobacco Association of Malawi (Tama) president Abel Banda said although it is difficult to predict tobacco prices, many growers are expecting improved prices due to low production of the leaf.

“As long as production will be per customer demand, the farmers are expecting good prices if demand and supply principle comes into the equation. We will follow the pricing issue closely because we want farmers to realise profits from their sweat,” he said.

Malawi’s tobacco marketing season starts in March or early April.

Tobacco regulator in the country, the Tobacco Control Commission is yet to announce the dates when trading floors will open.

But Banda said growers are happy that government usually sets minimum prices by taking into account the growers input per kg before the markets open.

“For growers to continue being in the business, we are anticipating good prices, otherwise our economy will suffer as tobacco is a major forex earner,” he said.

Meanwhile, TCC chief executive officer Kaisi Sadala has said a second crop assessment will be starting on Monday.

He hoped production improve as weather conditions have improved over the past two weeks.

Last year the country under produced by 45 percent.

Malawi was supposed to produce 151million kg of tobacco but only produced 106 million kg.

As a result, growers enjoyed good prices and lower rejection rate as compared to the previous year.

For example; during week 17 of sales, the average price was $2 as compared to $1.56 during the same period the previous year.