Zimbabwe breaks into cigar tobacco

Source: Zimbabwe breaks into cigar tobacco | The Financial Gazette June 16, 2016

Kenneth Matimaire

BURMA Valley smallholder farmers in Manicaland have made a breakthrough into lucrative cigar tobacco farming after clinching a market in German, the Financial Gazette’s Companies & Markets can report.
The farmers are producing a high quality strain used to make cigar wrappers, with assistance from seasoned commercial farmer, Lindsay Guild. Wrappers are the most expensive leaf to produce. However, they also fetch very good prices on the market.
This is breaking new ground for the farmers, as Zimbabwe is known as a producer of flue- cured tobacco. According to the Zimbabwe Tobacco Association (ZTA), the first claim to successful growing of flue-cured tobacco was made in 1894 in Mutare. A Jesuit priest at Chishawasha Mission, Father Richartz, exhibited his first commercially grown tobacco at the first Agricultural Show held in Harare in 1897.
A total of 13 smallholder farmers are currently part of the farming venture. An official involved with the project said they were growing a cigar tobacco strain known as cubra, which is used as a wrapper.
Guild has partnered with a Europe-based company called Von Eicken, which specialises in a wide range of tobacco products, in the project.
Von Eicken is a German-based company which manufactures and markets cigarettes, cigars, cigarillos, and pipe tobacco.
The venture, which was first mooted in 2013, was followed by the launch of the Cigar Wrapper Tobacco Auction Floor at Mapetu Farm in Burma Valley after a successful trial run of the top earning golden leaf last season.
The trial run covered one hectare, which was later increased to the current 11 hectares with plans underway to boost the area up to 20 hectares during the next season.
This development makes Zimbabwe the third African country after Cameroon and Kenya to produce cigar wrapper tobacco, which fetches higher prices on the market.
Guild, who is the Cigar Wrapper Tobacco Auction Floor’s technical advisor, said they had sold four tonnes of cigar tobacco on the first day of sales on June 2.
On that day, he said they had “about 80 bales averaging about 50 kilogrammes each, which is around four tonnes sold today”
“Our target is to reach 14 to 15 tonnes in sales by next year,” said Guild, who has been growing tobacco since 1977.
“Last year, we did one hectare as a trial and we fermented it and it’s now on its way to German. They were happy with the trial run. So this year we have gone up to about 11 hectares including small-scale. And then next year we plan to double the production,” he said.
Guild said plans were underway to seek more foreign markets since cigar tobacco was on high demand in America, United Kingdom and neighbouring South Africa. He, however, pointed out that Von Eicken was financially bankrolling the project.
Von Eicken’s senior buyer, Andrew Edmondson, indicated that they selected Burma Valley owing to its lucid climatic conditions, which was suitable for the growth of cigar tobacco.
Edmondson indicated that they had so far injected US$100 000 for inputs, which they expected to double to US$200 000 in the forthcoming season.
He added that they had also purchased drip kits for irrigation purposes.
“We have acquired 10 tonnes of tobacco. The arrangement is that when we settle our payments, we will also subtract US$100 000 worth of inputs that we availed to the farmers.
“I should also clarify that our company is not looking for an opportunity to exploit farmers by buying their tobacco at unfavourable prices but we want to build a solid business partnership which is beneficial to both parties involved,” said Edmondson
The highest grade of the cigar tobacco was sold for US$5,60 per kg on the auction’s opening day, while the least quality fetched around US$2,50 per kg.
The Tobacco Industries and Marketing Board indicated that sales of cigar tobacco would be conducted in Burma Valley when they officially opened auction floors this season, saying the move was meant to help farmers from the region from incurring miscellaneous expenses.
The auction floors were officially launched by Mutare South constituency legislator and Women Affairs Minister, Nyasha Chikwinya.
Cigar tobacco has no additives and is considered an environmentally friendly cash crop as it is air cured. It also fetches higher prices on the market compared to flue-cured tobacco.
Cigar wrapper, which is the highest grade, should be unblemished because it is used to wrap the cigar and influences the flavour.
The ZTA says Zimbabwe’s climate is favourable to the growing of tobacco, and that the crop does well on sandy loam soils where most grain crops would require a lot of fertilisers.
At peak production, the industry employed about 50 percent of all people employed in commercial agriculture. This estimate did not include other activities and downstream industries that exist to service the tobacco industry.
The sector was disrupted by government’s land redistribution exercise, which forcibly drove out white farmers and replaced them with blacks.
The new black farmers have slowly resuscitated tobacco farmers.
Zimbabwe’s leaf tobacco export earnings increased 11 percent year-on-year to US$ 855 million in 2015, as sales volume increased 12 percent to 152 million kgs, according to the TIMB.
Zimbabwe tobacco exports once accounted for 20 percent of the world’s flue-cured tobacco, the main ingredient in cigarettes.