Tobacco farmers earn US$305, 2 million

Source: Tobacco farmers earn US$305, 2 million | The Herald

Tobacco farmers earn US$305, 2 million

Grace Mahora Herald Reporter

Farmers have earned US$305, 2 million from the sale of flue-cured tobacco as prices continue to firm at the auction floors.

As of May 23, 2022, the Tobacco Industry and Marketing Board (TIMB) revealed that 102, 3 million kilogrammes worth US$305, 2 million had been sold by farmers.

The TIMB statistics show a decline from the 124, 2 million kilogrammes valued at US$335, 2 million sold during the same period last year.

Prices at the auction floors are higher than those being offered at the contract floors.

The average price at the auction floor on day 36 ( May 23, 2022) was US$3, 13 per kilogramme while an average price of US$2,97 per kilogramme was recorded at the contract floors.

The highest price of selling tobacco at the auction floor is US$ 4, 99 per kilogramme whereas the highest price at the contract floors is US$ 6.80 per kilogramme.

So far more tobacco has been sold through the contract system since the opening of the marketing season end of March.

According to TIMB statistics, farmers have sold 7 million kilogrammes of tobacco worth US$22 million through the auction floors while the contracted growers have sold 95, 3 million kilogrammes valued at US$283, 2 million.

Most farmers grow tobacco under contract farming because they are provided with inputs and in some instances working capital.

Some contractors also have extension officers who are on the ground monitoring the production of their crop and this reduces side marketing.

Concerns have however been raised over contractors offering inadequate inputs and demanding the whole crop.

Some contractors were in the past season accused of failing to pay growers on time.

The TIMB however had to introduce stiff measures to regulate contract farming in the tobacco sector.

This season, growers are retaining 75 percent of the proceedings of their crops in foreign currency, up from 60 percent last season.

Tobacco is one of the major sources of foreign currency in the agricultural sector contributing nearly US$800 million every year.