by Tabitha Mutenga
Zimbabwe is expected to net over US$500 million in export earnings from the 2010/2011 tobacco crop after initially raking in US$361 million from direct earnings during the marketing season.
Marking the end of the 2010/2011 tobacco season, the Minister of Agriculture, Mechanisation and Irrigation Development Joseph Made said the tobacco crop size had increased by seven percent to 132,4 million kilogrammes, from 123,5 million kg in 2010.
Made said the continued increase in production should be attributed to improved production from small scale farmers who increased output to over 132 million kg this year.
"The contract growing and marketing scheme, which is now about to enter into its eighth successive season, has played an important role in maintaining tobacco production in the country," he said.
At the inception of the dual marketing system, which allowed contract sales to operate concurrently with the auction sales, contract sales accounted for 23 percent of the national crop in 2004, rising to 39 percent in 2005 and to 56 percent this year.
Made called for a pricing and purchasing pattern that ensures growers' viability although this should not create arbitrage opportunities for the two marketing systems of auction and contract.
Tobacco growers have increased from a register of 8 500, growing an average of 10 hectares each to over 66 000 growers, growing an average of 1,3 hectares each, of whom 80 percent are small scale growers.
Speaking at the same occasion, Tobacco Industry and Marketing Board chairperson, Monica Chinamasa, remarked that the just ended tobacco-selling season was characterised by inadequate funding from the financial institutions.
"This has become a perennial problem that militates against rapid recovery of production.
The A2 sector is the most affected by this lack of funding, resulting in this sector accounting for 12 percent of total production, compared to 28 percent for A1, 18 percent communal, 11 percent small scale and 31 percent large scale producers," she said.
Chinamasa said there was need for a concerted effort to train growers to reduce handling losses, which were as high as 21 percent during the just ended season.
Production was also affected by continuous power cuts that increased the cost of production and reduce viability.
Financial Gazette
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