Tobacco market opens today
President Joyce Banda is today expected to open the 2014 tobacco marketing season at Kanengo in Lilongwe amid high expectations from industry players over good prices and quality leaf.
The opening of the market comes when the country is deep into budget support dry spell which has in essence mounted severe pressure on the foreign exchange market, fuelling speculation and a massive weakening of the local currency in the process, especially towards the end of last year.
Foreign aid has traditionally augmented foreign exchange earnings from tobacco-Malawi’s main export commodity.
But donors are withholding $150 million, a decision made on November 7, last year, vexed by revelations of public funds abuse at Capital Hill popularly known as Cashgate.
Tobacco Control Commission (TCC) chief executive officer Bruce Munthali yesterday expressed hope that the 2014 marketing season will be one of the best in the history of Malawi.
“All necessary arrangements have been completed to open the market at 8am and we expect President Joyce Banda to officially open the 2014 market at around half past nine in the morning,” said Munthali in an interview.
He said today 1 200 tobacco bales have been lined up for sale under the Integrated Production System (IPS) or contract marketing while 4 000 bales are set for auction sale.
He said as of yesterday, the market had received over 20 000 tobacco bales ready for sale.
“This is bottom leaf which generally has low quality but we still expect stiff competition among tobacco buyers which should improve prices on the market,” he added.
Munthali also said the commission has estimated that Malawi will produce 193 million kilograms of tobacco this year with 169 million being burley tobacco, 21 million flue cured tobacco and three million being dark fired tobacco variety.
Munthali also boasts that TCC has employed adequate tobacco classifiers as well as arbitrators to help facilitating the allocation of tobacco grades and mediate price disputes between growers and buyers, respectively.
In a separate interview yesterday, the Tobacco Association of Malawi (Tama) chief executive officer Graham Kunimba said the association is also set for the season and praised the quality of their leaf in the season which he hope will attract better prices this year.
Last year, Malawi earned $362 million from 168 million kilogrammes of tobacco. A significant improvement from $177 million earned from 79.8 million kilogrammes in 2012.
