Tobacco sales kick off in high gear

17 March 2010, The Maravi Post
URL: http://www.maravipost.com/index.php?option=com_content&view=article&id=2761:tobacco-sales-kick-off-in-high-gear&catid=48:economy&Itemid=129

Blantyre:  The market season of Malawi's chief foreign exchange earner, tobacco, Monday kicked off on a promising note with most farmers selling their leaf at above the government set prices.

Government recently decreed that the minimum price for burley tobacco should be US $2 per kilogramme, down from US $2.15 last year, while the minimum price for flu-cured tobacco was reduced to US $3 per kilogramme from US $3.9 last year.

Tobacco Control Commission Chief Executive Officer Bruce Munthali said at the opening of the market Monday no buyer offered less than the recommended prices.  "We have seen some leaf fetching as much as US $2.30 per kilogramme which is quite promising," he said.

Munthali said this signifies the fact that although tobacco production reduced this year the quality of the leaf has improved.

During the 2008/9 growing season farmers produced some 230 million kilogrammes of tobacco but, due to persistent dry spells and disaffection at prices offered by buyers at the auction floors last year, production for the 2009/10 growing season reduced to some 215 million kilogrammes.

Tobacco is Malawi's chief foreign exchange earner which accounts for over 30 per cent of the country's Gross Domestic Product and contributes up to 23 per cent in all tax collections. Over 75 per cent of all foreign exchange earnings is derived from tobacco. And, more significantly, at least 80 per cent of Malawians directly and indirectly depends on the tobacco industry