via China remains Zim’s largest tobacco buyer – DailyNews Live 7 April 2015
HARARE – China continues to dominate the country’s tobacco exports after the Asian country snapped up 19,4 million kilogrammes (kg) worth $167,6 million out of $218 million earned by Zimbabwe so far.
Statistics released by the Tobacco Industry and Marketing Board (Timb) show that South Africa came in second having spent $13,7 million on 3,6 million kg at an average price of $3,79 per kg, while Russia was ranked third after importing 1,4 million kg valued at $4 million at an average price of $2,87 per kg, with Mauritius buying 1,3 million kg for $5,4 million at an average price of $4 per kg.
The figures also indicate that 32 countries had imported the golden leaf, with the current export earnings and volumes significantly above 2014 prior comparable period figures.
For the same period last year, 15,3 million kg had been exported at $56 million at an average price of $4 per kg.
At number five was the United States of America which purchased 970 000 kg at an average price of $4,35 per kg, thereby spending $4,2 million.
The United Arab Emirates bought 848 034 kg respectively, at $3,75 per kg, spending $3,1 million.
Last year, 205,5 million kg of tobacco were sold, earning $651,9 million, the biggest sale in 13 years.
In 2014, more than 105 000 farmers took up tobacco production. The majority of the farmers are under contract farming. This has seen many foreign companies enter into farming deals with local growers who cannot afford inputs and other costs.
In the early 2000s, Zimbabwe was the second-largest exporter of flue-cured tobacco, but the sector’s fortunes reversed suddenly with the controversial land reform programme. The upheaval devastated the country’s agricultural sector.
However, steady gains by black Zimbabwean tobacco farmers have raised production of the crop closer to pre-reform levels and may help salvage the country’s struggling export sector.
The tobacco sector, which is critical to the country’s ailing economy, recorded an excess of $730 million in exports last year.
The Timb has however projected a lower output for the ongoing season attributed to late rains.
While deliveries at both the auction and contract floors has been depressed since the opening of the marketing season last month due to unfavourable prices, tobacco merchants have mobilised $824 million from offshore sources, in compliance with the central bank Tobacco Finance Order (TFO).
In terms of the TFO, Statutory Instrument 61 of 2004, all tobacco merchants are required to secure offshore lines of credit for the purpose of purchasing green leaf tobacco.
However, merchants who failed to secure offshore lines of credit are accommodated through a special dispensation granted by the Exchange Control — on a submission and approval basis — to access local finance to purchase tobacco for the current marketing season.
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