The Tobacco Control Commission (TCC) has forecast that chances are high that the country will surpass its target on foreign exchange earnings from tobacco in 2013.
During a 2012 tobacco annual congress held at Sunbird Nkopola Lodge in Mangochi last year, the Ministry of Agriculture and Food Security in conjunction with the tobacco industry experts had set a target of $300 million as expected earnings from Malawi’s main export crop.
Such a target, however, is almost double the $178 million which the country earned in the 2012 tobacco season.
But in an interview in Lilongwe yesterday, TCC chief executive officer Bruce Munthali sounded optimistic that as things stand now, earnings at the auction floors have already jumped the $178 million mark in the first 13 weeks of trading.
Said Munthali: “If we are talking of $200 million now, we may surpass the [$300 million] target and come next week we should be talking of over $220 million.”
A likely increase in tobacco earning this year, could, however, sustain the current availability of foreign exchange and in the process enable the country meet its import demands of strategic goods and services.
Unlike in recent years, the 2013 tobacco market season has been characterised by a stable market conduct with only two notable disruptions.
Munthali said since the onset of this year’s market, there has been there has been a minor stoppage as a result of disagreements among industry players ‘on operational set up.’
“The market is moving very fast and there has been quite substantial inflow of tobacco and more especially burley tobacco,” he said.
He attributed the continued stability of the tobacco market to recent reforms that the tobacco industry has embraced from this year’s marketing season in March.
He said both earnings and the significant volume of tobacco sold so far speak volumes that the market is on course which he said will necessitate Malawi to earn increased revenue than that of other years.
On Friday, most tobacco growers interviewed at the Lilongwe Auction Floors, said they were happy with this year’s tobacco prices, especially at the beginning of the season when the kwacha was massively depreciating.
Tinenenji Mpema, a burley tobacco grower from Madisi in Dowa, said during two weeks of trading, he had sold his tobacco at an average price of about $2 per kilogramme which he said has enabled him to purchase adequate farm inputs in readiness for next year’s season.
“I have already bought burley tobacco seed, chemicals and some fertiliser to prepare for next year. What I have seen is that most of us tobacco farmers who sold more volume in March and April, were so lucky since the Kwacha was weak then unlike today when the Kwacha is trading as low as K315 to a dollar,” said Mpema.
