Malawi strategise on prices

With this year’s tobacco selling season just around the corner, Malawi’s Tobacco Control Commission (TCC) says it has engaged industry stakeholders on how to improve tobacco prices.

TCC public relations officer Juliana Chidumu said in an interview on Tuesday there are a number of areas the industry regulator is looking at to address the problem of poor prices.

Malawi had a forgettable tobacco selling season last year as prices sunk 30 percent to hit a national average of $1.24 (K207.08).

Chidumu said TCC is concerned that several farmers felt they were not rewarded well last year.

She cited, among other things, the lowest grade of no grade wet (NGW), as one of the factors that pulled average prices on the auction floors last year.

“NGW is a grade given to poor quality and wet tobacco. Last year, this grade attracted an average of $0.50 [about K83.5] per kg. Unfortunately, the buyers scrambled for this type of tobacco, leaving the quality one, thereby, pulling down the national average.

“What we have done this year is to remove this grade. This means there will only be quality tobacco on the market. We are sensitising farmers that no one will buy wet tobacco if they bring it to the market this time around. We hope that this will in the end leave the buyers with no option but to buy the quality tobacco at better prices,” said Chidumu.

She also said TCC is discussing with stakeholders on the minimum price of buying the crop this year, taking into consideration the rising cost of production.

Chidumu appealed to tobacco growers to adhere to specific dates of delivery of crop to the auction floors and to use recommended transporters when taking their leaf to the market to maximise their earnings.

Over the past years, there have been incidences of growers spending days or weeks before offloading their bales at the auction due to their failure to adhere to agreed dates. This has often times resulted in farmers coughing more than necessary for transport.

Analysts are expecting a good tobacco season this year, largely due to suppressed output.

Unofficial crop estimates indicate that this year’s tobacco production will go down by as much as 50 percent due to the quota system introduced last year coupled with frustrated growers who have resorted to growing other crops such as cotton.

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