Tobacco earnings have hit $345 million (about K604 billion) 13 weeks into the 2025 Tobacco Marketing Season, with about 80 percent of the projected tobacco sold.
The market, according to Auction Holdings Limited updates, sold 136.3 million kilogramme (kg) which is about 78 percent of the projected tobacco output of 174 million kg and more than last season’s total of 133 million kg.
Meanwhile, at $2.53 (K4 430) per kg, the average price remains 13 percent below corresponding period last year where it was $2.96 (K5 182) per kg and continues undermining total earnings, recorded at $345 million from $372 million (K652 billion) last year.
In an interview, Tobacco Commission spokesperson Telephorus Chigwenembe said the increased volumes indicate that the country has produced more, which is good for the economy.
He said: “We are seeing a steady flow of tobacco to the auction floors and this is a good development because it is an indication that we are going to have good volumes of the crop this year and it’s very satisfying.”
In a separate interview, Tama Farmers Trust chief executive officer Nixon Lita described the season as mixed with increased flow of the leaf, but relatively lower prices.
He said: “The market is progressing well, and indications are that estimated tonnage might be achieved.
“In terms of price, we are still lower than same time last year but an improvement is being noted as upper leaf is dominating the market now.”
Lita has since urged farmers to start preparing for next season with registration, considering the hectarage and resources they can manage, especially fertiliser.
Earlier, agriculture and economic experts warned that low tobacco prices and the country’s continued dependence on the leaf for foreign exchange poses economic challenges.
Mwapata Institute research fellow Christone Nyondo also indicated that low prices could harm the country’s foreign exchange reserves and trade balance.
He said this means that the Reserve Bank of Malawi may find it challenging to stabilise the kwacha, leading to increased import prices for essentials such as fuel, fertiliser and medicines.
“The market structure is dominated by an oligopoly. Buyers can collude to maintain low prices while farmers, especially smallholders, have little bargaining power,” said Nyondo.
Meanwhile, TC has opened farmers’ registration for the next season, running for four months from 23 June 2025.
Last season, Malawi earned $396 million (about K693 billion) after selling 133 million kg of tobacco at an average price of $2.98 (about K5 217) per kg. This year, the country expects to produce 174 million kg.
