Business Reporter
Zimbabwe is on course to reclaim its place as one of the major suppliers of tobacco in the world with preliminary indications showing that the country is now the second highest supplier of the golden leaf in the world after Brazil.
Tobacco Industry and Marketing Board chief executive Dr Andrew Matibiri said the final position will, however, be determined later in the year when the other markets have closed.
“Other markets are still in the middle of selling and final figures will be released around December,” he said.
Apart from Brazil other markets for tobacco include America and India. The country has so far received 216,1 million kilogrammes this year compared to almost 166 million kg purchased during a similar period last year.
This year’s produce is just 20 million kg shy of the country’s all-time high production figure of 236 million kg achieved in 2000.
The country’s tobacco selling season is expected to be concluded this week with the two remaining contractors winding up business.
“Tianze and Northern Tobacco will be holding their clean-up sales this week and we do not expect much change in our figures,” Dr Matibiri said.
“We are very impressed with the amount and quality of tobacco that we have received this year, there has been a lot of improvement.”
Deliveries of virginia tobacco have breached the 216 million kilogrammes mark as the crop continues to trickle in two months after the official close of the season.
The 2014 marketing season which began in February has been dominated by contractors who have received the bulk of the crop.
According to the TIMB the contract system has accounted for the bulk of this year’s crop with at least over 70 percent of the delivered crop having come from contracted farmers.
Most tobacco farmers have been drawn to contract farming due to the availability of inputs plus better prices offered under the system compared to the auction system.
Contractors have been offering average prices of $3,32 per kg for the contracted against $2,69 per kg at the auction floors.
Tobacco is one of the crop that has been identified as key under the Zimbabwe Agenda for Sustainable Socio-economic Transformation. Stakeholders in the tobacco industry while welcoming the increase in production have pointed to the need for value addition on the crop to maximize returns and also to create much-needed jobs.
Savanna Tobacco executive chairman Mr Adam Molai recently said Zimbabwe could have earned $65 billion instead of $650 million that it realised from tobacco sales in the 2014 marketing season had it processed the crop into finished products.
“We are at the whims of global fluctuations and market prices but ultimately once we go to the final beneficiated product, the price is constant and at times increases,” he said at an agro-forum.
“The current output this year would have generated $6,5 billion for us. The value addition premium is $5,8 billion”