Commercial Farmers' Union of Zimbabwe

Commercial Farmers' Union of Zimbabwe

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China drives Zim tobacco recovery

China drives Zim tobacco recovery

by Tobias Manyuchi     Thursday 24 February 2011

HARARE – Cash-rich Chinese merchants will snap up nearly half of Zimbabwe’s 
2011 tobacco crop helping to drive up prices, while breaking the 
stranglehold of mostly European buyers accused of keeping prices down in 
past years, Harare tobacco authorities said.

Tobacco Industry and Marketing Board (TIMB) chief executive officer Andrew 
Matibiri told a special parliamentary committee that the entry of the 
Chinese had been a boon to Zimbabwean growers with prices now averaging 
US$0.58 more per kilogramme than before arrival of buyers from the Asian 

“Of the tobacco sold 40 percent is going to China, the other 40 to Europe 
and the remainder to other parts of the world,” Matibiri told Parliament’s 
portfolio committee on agriculture, water, lands and resettlement earlier 
this week.

“Before the arrival of the Chinese US$2.99 per kilogramme was the ceiling,” 
he said, adding that tobacco prices have averaged US$3.57 per kg since the 
tobacco auctioning season began last week.

According to Matibiri, who spoke to the parliamentary committee on 
Wednesday, prices were expected to continue firming up on the back of 
growing Chinese demand.

Tobacco’s earnings potential has fallen behind that of mining in recent 
years chiefly because of President Robert Mugabe’s controversial land reform 
programme that saw large-scale white commercial growers expelled from the 
land and replaced by black villagers without experience or capacity to 
maintain production.

Before land reforms, a few hundred white commercial farmers produced on 
average more than 200 million kilogrammes of tobacco per year that earned 
Zimbabwe around  $400 million annually, making the crop the country’s single 
largest foreign currency earner.

But the tobacco sector is on the road to recovery with 60 000 mostly black 
farmers  — or 35 000 more farmers than were recorded last year  — expected 
to deliver 170 million kilogrammes of tobacco by close of the selling season 
at the end of September.

Zimbabwe produced 123 million kilogrammes last year that earned the country 
US$384 million.

The Chinese companies have in recent years targeted cash-strapped Zimbabwean 
small-scale tobacco farmers whose production they finance in return for 
preferential access to the crop.

China purchases the crop through the China Tobacco Company represented in 
Zimbabwe by Tian Ze.

“Farmers are responding positively and the prices have been favourable 
mostly attributable to the presence of the Chinese,” Matibiri said.

Since the marketing season opened last week, tobacco worth more than US$175 
million has been exported.

China has emerged as one of Zimbabwe’s most important political allies and 
trading partners since 2000 when Mugabe adopted his ‘Look East’ policy.

The policy is premised on the need to find new trading partners and markets 
after traditional investors from Western nations turned against Harare in 
protest over Mugabe’s human rights abuses, repression against political 
opponents and his violent land reform programme.
The “Look East” policy specifically targets investors from Muslim and Asian 
nations and in exchange Zimbabwe has promised minerals – including diamonds 
and gold – and prime land to the investors, resulting in Harare penning 
several agreements mainly with China, Russia and Iran.– ZimOnline


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