Zimbabwe tobacco output seen up, but shy of target
Wed Feb 15, 2012 12:20pm GMT
By Nelson Banya
HARARE (Reuters) – Zimbabwe’s tobacco production is set to continue its
recovery this year, but output might be short of the projected 150 million
kg due to limited funding and erratic rainfall, farmers said as the auction
season opened on Wednesday.
Tobacco, which earned Zimbabwe about $400 million in 2011, has fallen behind
mining as the country’s leading foreign currency earner, after President
Robert Mugabe’s seizure of white-owned farms saw production of most major
crops plummeting.
Tobacco output declined to 48 million kg in 2008, from a peak of 236 million
kg in 2000.
Small-scale farmers have led a rebound, aided by the use of stable foreign
currencies adopted by the government to replace a local unit destroyed by
hyperinflation, and funding from China – which now dominates a market
previously controlled by Western merchants.
The Tobacco Industry Marketing Board (TIMB), which regulates the sector in
Zimbabwe, says it expects production to reach 150 million kg this year, up
from 131 million kg previously, but farmers say that target is not likely to
be achieved.
“We will be happy if we could match last year’s production. The rains were
patchy and many growers dropped out due to lack of funding, so we are
unlikely to see such a significant leap in output,” Zimbabwe Farmers Union
vice president Berean Mukwende told Reuters during a ceremony to mark the
official start of the auctions.
Over 50,000 mostly small-scale black farmers have taken over production of
the bulk of the crop, once the preserve of white commercial farmers
Tobacco farmer Elphanos Mashingaidze said although output was unlikely to
change from the previous year, farmers expected firmer prices this time
around.
“Today’s opening prices, for what is typically lower grade tobacco, give us
confidence that this year prices could be better,” Mashingaidze said. “We
need an average price of $4.50 per kg to farm profitably.”
He said while Chinese firms were funding some farmers under contract growing
schemes and purchasing about 75 percent of the crop, many farmers were still
struggling to get bank loans to finance their operations.