Malawi tobacco revenue hits $93.26m
Total cumulative tobacco revenue went up by 30 percent in week nine to $93.25 million from $72 milion in the previous week, Malawi’s Auction Holdings Limited (AHL) sales summary has shown.
Official AHL tobacco sales summary for week nine published on Monday indicates that last week the leaf raked in $20.87 million which includes $17.06 million from burley, and $2.84 million from flue cured tobacco.
“Throughput in week nine rose as deliveries at Mzuzu floors [in northern Malawi] picked up. Increased dominance of leaf styles coupled with additional buyers on the line resulted in highest daily average of the season of $2.12 per kg on burley sales. Weekly burley volumes increased in week nine due to the five-day sale period as opposed to the four-day sale period of week eight due to Labour Day Holiday. At the end of week nine the market has out-performed last season’s performance by 94 percent on volume sold and by 87 percent on proceeds realised,” reads the statement in part.
The AHL sales summary indicates that about 51.67 million kilogrammes of tobacco have been sold up to week nine, which includes 47.68 million kilogrammes of burley and 3.36 million kilogrammes of flue cured tobacco.
Recently, the kwacha has shown signs of stabilisation due to proceeds from tobacco. Malawi’s main foreign exchange earner accounting for more than half of all foreign exchange earnings boosted gross official foreign exchange reserves to an equivalent of 1.26 months on May 3 up from 1.09 months in the week before. Private sector reserves were also bolstered to 1.38 months from 1.21 months in the same period.
The boosting of the country’s foreign currency reserves could be useful to anchor the kwacha which has been on a free fall for the most part of the last twelve months since the adoption of a liberalised exchange rate regime in May last year. The boosted reserves would also help the private sector procure fuel and other important raw materials for production purposes.
Malawi is this year expected to realise about $300 million from the leaf which accounts for 13 percent of gross domestic product (GDP), up from last year’s $177 million when the country realised the worst output in 18 years at 79 million kg.
In an earlier interview, Tobacco Control Commission (TCC) chief executive officer Bruce Munthali expressed confidence with the level of proceeds this year compared to the same period last year.
He said if the trend continues, Malawi is poised to have a favourable tobacco market season this year.
