Zimbabwe tobacco crop to leap with Chinese funding
Wed Feb 16, 2011 1:56pm GMT
* Farmers receive more funding
* Chinese firms now buying most of the tobacco
By Alfonce Mbizwo
HARARE, Feb 16 (Reuters) – Zimbabwe’s tobacco output will increase at least
40 percent this year after a boost in funding to farmers from banks and
firms, many of which are Chinese, and due to good weather, an industry
official said on Wednesday.
Chinese companies have become the major financiers and buyers of Zimbabwe’s
tobacco crop and industry officials say these firms will buy at least half
of this year’s tobacco.
Tobacco’s earnings potential has fallen behind that of mining in recent
years. Before the collapse of commercial agriculture in 2000, as President
Robert Mugabe oversaw the seizures of white-owned farms, it was the
country’s single largest foreign currency earner, generating $400 million.
Tobacco Industry and Marketing Board (TIMB) chief executive Andrew Matibiri
told Reuters during the opening of the 2011 selling season that he expected
sales of at least 170 million kg this year, up from 120 million kg last
year.
“The rains and other conditions have been favourable this year and while
farmers still experienced some problems — such as power shortages,
shortages of working capital among others — overall the situation was ideal
for tobacco farming,” Matibiri said.
More than 30,000 small holder farmers have replaced white-owned commercial
farmers, who had traditionally produced the crop, which reached a peak of
236 million kg in 2000.
The government has said the agriculture sector is recovering, and that
farming had now become lucrative after Harare abandoned its worthless
Zimbabwe dollar in favour of foreign currencies like the U.S. dollar and
South African rand.
The southern African country’s economy grew for the first time in 2009 after
Mugabe formed a unity government with his rival, Prime Minister Morgan
Tsvangirai, and officials see growth of up to 15 percent this year due to
growth in agriculture and mining.
On Tuesday tobacco prices ranged between $1.20 and $4.20 a kg on the auction
floor in Harare. Last season prices were highest at $4.80 and lowest at
$0.50 and the average was $2.91.
Mugabe, who turns 87 next year, has defended his land seizure drive as
necessary to correct colonial land imbalances and sees the recovery in
agriculture as a vindication of the policy.