TC admits hurdles on tobacco market
Tobacco Commission (TC) has admitted that the 2022 tobacco marketing season was beset by a number of challenges, including low output despite prices being better than last year.
TC’s comments comes at a time Lilongwe and Limbe floors closed the markets last Friday following the closure of Chinkhoma floors on July 20. Mzuzu floors is expected to close later this month.
In an interview on Monday, TC spokesperson Telephorus Chigwenembe said though production was low this year, good prices offered on the market will move growers into more production of the leaf next year.
He said: “The average price of burley tobacco grown mostly by smallholder farmers was above $2.10 per kilogramme [kg] which compares to an average price of $1.60 per kg in a similar period last year.
“With this, we look forward to meeting international demand for Malawi tobacco, which we have not been able to satisfy at least for the past three farming seasons.”
Malawi has in recent years been expected to supply up to 140 million kg of tobacco to the international market, but production has been falling short for the past three seasons.
In 2020 and 2021, the country produced 114 and 123 million kg of tobacco, respectively.
But Chigwenembe is upbeat that things will change in the next season, saying in the ongoing grower registration and licensing exercise, the commission has raised the minimum production quota for clubs from 3 000 to 5 000 kg although growers with limited capacity are allowed to get licensed for less than the set minimum.
Tobacco farmers, on the other hand, have described the 2022 tobacco marketing season as mixed, saying though prices were higher than the previous year, the high cost of production affected their gains.
Tama Farmers Trust president Abiel Kalima Banda said farmers spent a lot on production due to factors such as the late onset of rains, a situation which affected their revenues and frustrated them.
He said: “Indeed prices this year were higher when compared to last year and we had a lot of setbacks, but our concern was that these prices were not reflective of the cost of production. Whether farmers will be willing to continue, let us wait and see.”
This year, projected production volumes for tobacco, according to the first round of crop estimates survey, was 103 million kg against buyers’ demand at 154 million kg.
This is shy of what the country produced last year where, cumulatively the country earned $197.1 million from 123.7 million kg of tobacco sales.
Meanwhile, it is yet to be seen if the projected 100 million kg output for 2022 will be achieved as TC figures show that 83.8 million kg of tobacco has been sold, raking in $179.3 million as of July 29.
