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Tobacco Production To Miss Target

WITH a week left before the 2008 tobacco selling season ends, farmers have missed the targetted output by about 70 million kilogrammes from the initial projection of 120 million kg.

 

Figures made available from the Tobacco Industry and Marketing Board (TIMB) on Tuesday revealed that a total of 44,9 million kg valued at US$145,6 million was sold on the 97th day of trade compared to 70,4 million valued at 164,9 million achieved during the same period last year.

The 120 million kg initial projection was revised twice during the first quarter of the year to 100 million kg and then 70 million kg because of heavy rains and the shortage of fertiliser and diesel.

Tobacco which used to be the country’s major foreign currency earner after mining, is now second, accounting for about 35% of all hard currency receipts as production continues to decline.

Of the 44,9 kg million, Burley Marketing Zimbabwe (BMZ) handled 5,2 million kg valued at US$18,4 million while Tobacco Sales Leaf (TSL) sold 4,8 million kg valued US$16,9 million.

The Zimbabwe Tobacco Auction Centre (Zitac) processed transactions amounting to US$17 million from 5,2 million kg. Contract farmers sold 29,5 million kg valued at US$93,1 million.

The 44,9 million kg sold so far is a far cry from sales during the country’s days of glory, when tobacco production reached a record high of 236,13 million kg in 2000.

Tobacco production has declined since the country embarked on the land reform programme in February 2000.

This was because most beneficiaries of the land redistribution programme had little knowledge or inclination towards tobacco farming. In 2001 a total of 202,5 million kg was sold. The decline continued in 2003 to 2005 when 81,8 million kg, 69,1 million kg and 73,3 million kg were sold. In 2006, 55,5 million kg were sold while only 73,5 million kg were sold last year.

Farmers have, however, expressed optimism that the sector is destined to be revived following the conclusion of a political settlement between the country’s three main political parties.

As had become the norm with previous seasons, there were delays in the official opening of the season as issues that had haunted the previous seasons resurfaced.

These included the support price, a new exchange rate as well as the settlement of the outstanding foreign currency account shortfalls.

Farmers also expressed concern of over maximum cash withdrawal limits, shortage of fuel and paper to wrap their tobacco.

The official opening of the season was delayed by a week for the seventh consecutive year after the TIMB failed to get the requisite response to farmers concerns.

When the season finally opened, farmers were promised $70 million per US dollar earned but as soon as the floors opened farmers blocked sales protesting the “low and unattractive” opening price. Angry farmers reportedly tore up sales tickets and stood on tobacco bales to block auctioneers, while others tied up their bales.

The situation was only resolved after the Reserve Bank introduced a floating exchange rate that saw the support price falling away.

This measure gave stability to tobacco sales sessions at the three auction floors. Hardly a month later farmers raised concern in May about withdrawal limits and amounts that they were getting from banks, which they said, were too little.

The Reserve Bank responded by issuing special cheques in denominations of $5 billion, $25 billion and $50 billion and a special withdrawal limit of $100 billion for farmers which was above $5 billion for the rest of the banking public.

The issue of withdrawal limits presented a major headache for officials at the floors who had to contend with increasing numbers of farmers most of whom had to spend days and weeks at the floors while trying to access their money.

The situation presented a healthtime bomb as available facilities in terms of toilets failed to cope resulting in the farmers resorting to using the bush and sleeping in the open.

Apart from withdrawal limits, the season has also been affected by transport and diesel shortages that have seen some farmers, especially those in the small-scale sector failing to deliver their crop to the floors.

By Paul Nyakazeya

 

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