Tobacco worth US$345,2 million has been sold through the auction and contract market at a seasonal average price of US$2,78 per kg this week. Figures obtained from the Tobacco Industry and Marketing Board show that 125,7 million kg had been sold compared to 107 million kg the same period last season.
At its peak in 1999, Zimbabwe grew 20 per cent of the tobacco that enhanced the taste of cigarettes made by companies including Philip Morris and RJ Reynolds Tobacco Holdings. Export income has been as much as US$600 million a year.
A come back
Zimbabwe's land grab programme had choked the industry. Since the start of President Robert Mugabe's farm resettlement campaign a decade ago, tobacco production had dropped by one-third. However, the formation of the unity government in 2009 ushered in a multi-currency regime, and the crop has made a come back.
More than half the 1 400 growers had their acreage seized, shrinking crops to a level where tobacco buyers such as Standard Commercial had to turn to rival Brazil. But the new farmers have performed wonders.
"We like what we see," said Millennium marketing and financial manager, Kudzayi Hamadziripi.
Universal and British American Tobacco scrapped their investments in the country because of the fall in production. The departure of these buyers left Zimbabwe farmers in serious difficulties, but the Chinese have since filled that void.
Zimbabwe's tobacco industry began in 1894 and now dominates the trade of top-quality tobacco, known as flue-cured tobacco, together with Brazil and the US. This type of leaf makes up more than 90 per cent of each country's tobacco exports.
"Assuming the trends continue, we are on course for a magnificent recovery," said Andrew Matibiri of the Tobacco Industry and Marketing Board.
Post published in: News