Source: TIMB still hopeful of beating tobacco target | The Herald May 8, 2019
Golden Sibanda Senior Business Reporter
The Tobacco Industry and Marketing Board (TIMB) is adamant tobacco deliveries could still breach this year’s target of 240-260 million kilogrammes despite sales from March to date trailing last season’s numbers by 36 percent for the same period.
A dip in production or deliveries of the golden leaf is a cause for concern for Zimbabwe considering that tobacco, which last year generated nearly US$1billion, is the country’s second single largest foreign currency earner, after gold.
Zimbabwe remains particularly hopeful that deliveries will reach targeted levels and rake in more than last year’s forex earnings amid concerns over production trends in gold, which saw deliveries dipping 10 percent at 6,3 tonnes in the first quarter.
Reserve Bank of Zimbabwe Governor Dr John Mangudya said gold deliveries declined as small scale miners, who account for over half of production, protested the reduction of the forex retention threshold from 75 to 55 percent.
At least 46 million kilogrammes of flue-cured tobacco worth US$82 million has been sold since the opening of the 2018/2019 marketing compared to 72 million kg sold in the same period last year, when total deliveries topped 252 million kg.
TIMB chief executive Emmanuel Matibiri told The Herald Business in an interview yesterday that deliveries to the country’s tobacco floors were negatively affected by the late onset of the planting season and prevailing low prices.
However, he said while it was a fact that some farmers have withheld their crop in protest over relatively lower prices this year compared to the prior year, tobacco sales floors will remain open until around early August this year.
Dr Matibiri said farmers who may not be happy about prices being offered at the auction floors retain the freedom to deliver their crop for sale when the marketing season reopens next year, but warned poor storage could affect quality of the crop.
“Obviously, the season was late in terms of the time of planting of the crop; that is reason number one and then reason number two is that the prevailing prices are discouraging farmers from bring more tobacco for sale,” Dr Matibiri said.
The TIMB boss said while some farmers may clearly be holding on to their crop, there was still time for those that may decide to sell at a later stage of the marketing season, which he said ended end of July or beginning of August.
Efforts to get a comment from Zimbabwe Farmers Union president Paul Zakaria on the prevailing situation in the tobacco industry were not successful by the time of going to print yesterday.
The highest price at the action floors this season thus far is US$4,65 per kilogramme while contractors have offered the highest price of US$5,60 per kilogramme, while the lowest price has remained at US$0,20 per kilogrammes.
“The auction floors and the market will remain open until we are satisfied that all those who want to sell their tobacco have sold. Those who want to carry over tobacco to the next season, according to the law, have strict permission to do that,” he added.
Deliveries to the floors were low during the first days of the season as some farmers adopted a wait-and-see attitude, while others withdrew their bales in protest at the low prices on offer.
However, tobacco deliveries and sales have been growing gradually as prices picked and after the Government scrapped the intermediated money transfer tax.
The 2019 tobacco crop was grown under unfavourable weather conditions characterised by late rains and prolonged dry spells especially when the crop was almost ready for reaping.
Source: TIMB still hopeful of beating tobacco target | The Herald May 8, 2019 Golden Sibanda Senior Business Reporter The Tobacco Industry and Marketing Board (TIMB) is adamant tobacco deliveries could still breach this year’s target of 240-260 million kilogrammes despite sales from March to date trailing last season’s numbers by 36 percent for the […]