Minister warns against tobacco buyer cartels
Minister of Agriculture Lobin Lowe has warned new tobacco buyers against joining cartels of seasoned buyers to exploit growers through poor price offers.
The minister issued the warning on Friday when he officially issued a new local buying tobacco company, Protrade Group Limited, with a tobacco buying licence for the 2022 tobacco marketing season.
Lowe said being a local tobacco buyer it should appreciate how tobacco farmers are struggling to benefit from the crop because they are being exploited by some traditional buyers.
He said: “If you will dance to the tune of the seasoned tobacco buyers, then you will not make any difference on the tobacco market.
“Malawians will be looking at you to make a difference, otherwise you know how the cartels ill-treat our farmers. You as a local buyer, must influence better prices on the market when others are looking away with their poor prices.”
Lowe advised growers to properly grade their leaf so that they fetch better prices on the market and do away with the tendency of buyers offering poor prices.
On his part, Protrade Group Limited president and group managing director Lodzani Fatchi said the company is Malawian wholly-owned and that they have done thorough research to improve the performance of the tobacco market.
He said: “We have everything in place, we are ready to compete on the tobacco market and we have off-takers from all over the world. All things being equal, we want to scramble for over 10 million kilogrammes [kgs] of tobacco from this year’s volumes.
“We have a good business model which has ready financiers in place, both within and outside the country, so we have enough capacity to execute.”
Tobacco Commission (TC) chief executive officer Joseph Chidanti Malunga said the granting of the licence to the firm meant they have passed all regulatory requirements.
He said since the company has come amid the tobacco growing season, they will only buy their registered quantities from the auction market other than the contract market which is established prior to the growing season.
In the 2021 marketing season, the country earned $197.1 million (about K160 billion) from tobacco sales. which was 13 percent higher than the prior year.
