dyton mupawaenda
Edgar Vhera-Agriculture Specialist Writer
TOBACCO farmers have so far netted 32 percent of the US$897 million they earned last season, thanks to a 19 percent surge in the average price of the golden leaf from US$3, 00 to US$3, 57 per kilogramme in the ongoing marketing season.
If the average price continues on this level, then last season’s total sales of US$897 million can be achieved with the sale of 251 million kilogrammes of the leaf.
Statistics from Tobacco Industry and Marketing Board (TIMB) show that by Day 28, there was a three percent increase in tobacco auction and contract sales from US$275 082 861 last year to US$284 675 329 this year.
Volumes of the leaf have, however, dropped 13 percent from 91 780 298 kilogrammes last season to 79 705 666 this season due to the El Nino drought.
Growers with free tobacco account for six percent of all sales after delivering 4 549 014 kilogrammes of the leaf worth US$17 057 156 at an average price of US$3, 75 per kilogramme.
Farmers producing tobacco under contract have the lion’s share at 94 percent after the sale of 75 156 652 kilogrammes valued at US$267 618 173 after getting an average price of US$3, 56 per kilogramme.
Although there was a 19 percent decline in bale rejections this year compared to the same period last season, auction floors have a high rejection level of 12 percent compared to their contract counterparts who trail by two percent.
The highest price on the auction system slightly gained 0, 02 points to close at US$5, 07 per kilogramme while contract floors’ price remained at US$6, 99. The lowest price for both years has remained static at US$0, 10 for a kilogramme.
This year, Government has allowed farmers to retain the standard 75 percent of their foreign currency earnings in line with other market players, while the 75/25 split is being applied on net sale proceeds after settlement of all loans, levies and other marketing costs.
“The 25 percent local currency portion for tobacco farmers will be applied to the net sales proceeds after settlement of levies and other marketing costs and not on the farmer’s gross earnings,” the TIMB said.
The board’s comments come in the wake of complaints by some farmers that the 75/25 percent foreign and local currency retention ratio was being effected on their gross earnings before the deduction of costs as stipulated by the Reserve Bank of Zimbabwe (RBZ).
Meanwhile, Zimbabwe Tobacco Growers Association (ZTGA) chairman Mr George Seremwe yesterday said most tobacco farmers were selling their crop at auction and contract floors, while others were doing land preparation for the upcoming season.
“Other farmers in areas like Dotito and Mt Darwin, who experienced a late start of the season, are still reaping and curing their crop,” he said.
The Government earlier this year reviewed the tobacco seedlings destruction date from December 31 to January 15, as a way of giving farmers ample time to finish planting their crop because of the late rains that were received in the country.
Online Reporter