Zimbabwe’s 2020 tobacco marketing season, which was set to start on April 22, is in jeopardy due to the outbreak of the coronavirus disease, the industry has warned.
BY FIDELITY MHLANGA
Tobacco is one of the country’s top foreign currency earners and is key in providing liquidity for the importation of key essentials that include fuel, grain and raw materials.
Patrick Davenish, the Tobbacco Industry Marketing Board (TIMB) chairperson, told Standardbusiness on Friday that if the coronavirus outbreak was not halted by next month, the industry “may be in trouble”.
“The position is that we have set the tobacco marketing season dates to the 22nd of April 2020 and what that means is that it gives us a month to monitor developments regarding the virus,” Davenish said.
“If it becomes worse we may come up with other options depending on the situation on the ground.
“If the situation gets worse, we may be in trouble.
“Tobacco auction floors are on the ground reviewing options that can be viable for this marketing season.
“The contract floors are also considering if they can have sales with a small number of farmers.”
Zimbabwe Tobacco Association president Rodney Ambrose said the body was working flat out to raise awareness about the disease to save the industry.
“As an association, we are undertaking educational and preventative measures on farms,” Ambrose said. “This exercise is covering farmers themselves and farm labourers.”
During the selling season, tobacco floors become a hive of activity with traders, vendors and farmers teeming around the premises — a scenario, which poses a huge risk of spreading coronavirus.
George Seremwe, the Tobacco Association of Zimbabwe president, said they were also watching the situation closely as it would have a huge impact on the future of growers of the golden leaf.
“We are hoping that TIMB and relevant authorities will put in place measures as per their word,” Seremwe said.
“As farmer representatives, we are watching carefully so that we do not put our members at risk. As it stands, it’s risky.
“We are monitoring closely. “For now, we are encouraging our growers to take necessary precautions to avoid Covid-19.”
Patrick Dutiro, a member of Parliament’s agriculture committee, suggested the decongestion of auction floors during the selling season and payment of farmers in foreign currency to discourage them from going to banks to withdraw their money in local currency.
“No farmer should bring his tobacco to Harare without booking,” Dutiro said.
“Sales can be conducted smoothly without the owner being there.
“It is the payment, which forces farmers to follow their tobacco to the floors.
“What is readily available is the United States dollar as opposed to the Zimbabwe dollar.
“In these circumstances, it’s better to pay farmers in US dollars 100%. It lessens pressure on the farmers’ need to go to the bank since the US dollar will maintain value and farmers won’t panic in fear of inflation when they are paid in the Zimbabwe dollar.”
Zimbabwe is the sixth largest tobacco grower in the world and the country gets about US$1 billion annually from the crop.
The Reserve Bank of Zimbabwe (RBZ) and TIMB recently said tobacco farmers would retain 50% of their sale proceeds in foreign currency and the money would not be liquidated when this year’s marketing season commences.
They said foreign currency entitlements for growers would be treated as free funds and may be retained in foreign currency accounts for an indefinite period.
Farmers who require cash to settle immediate essential requirements such as transport expenses and other incidentals would have access to cash at a rate of $1,50 per kg of green leaf tobacco sold, up to a maximum of
$2 000, the RBZ said.
Cash withdrawals may be reviewed as the selling season progresses.