Good quality tobacco leaf grades in high demand this year
February 27, 2015 in Business
AN increase in global supply of stocks of lower grades of tobacco may weaken the marketability of inferior quality leaf, a Tobacco expert has said.
BY FIDELITY MHLANGA
With the tobacco marketing season opening next Wednesday, Zimbabwe Tobacco Association (ZTA) executive Rodney Ambrose warned that this year middle to upper good quality leaf grades will continue to be in high demand and attract higher prices than lower grades.
“We have had reports of global oversupply and an increase in stocks of lower grades of tobacco so the market may be weaker for these grades.
“However, middle to upper good quality leaf grades will continue to be in high demand and attractive prices are expected to be paid. Also our main competitor, Brazil has a fairly good crop. Despite this, we look forward to a great selling season ahead,” Ambrose said.
He said that Zimbabwean tobacco was likely to face stiff competition from Brazil which has a fairly good crop.
ZTA members produced 64,8 million kilogrammes of tobacco out of the 216 million national output last year. This year its members are expected to produce 70 million kg buoyed by a 30% membership from last year.
“We are ready to start selling come Wednesday March 4. Although a late season, there is sufficient tobacco crop ready for the market. The crop ready for the market is of a good quality. Farmers have been advised of the markets requirements in order to ensure a successful start of the selling season,” Ambrose said.
Total flue-cured tobacco output in 2014 amounted to 216 million kg, up from 165, 85 million kg realised in 2013.
In its 2015 national budget, government projected a hectarage of 90 000 for tobacco, whose output is projected at 222 million kg.
However, the tobacco industry has projected around 190 million kg of tobacco at this stage of the season.
The 2015 tobacco marketing season which traditionally opens mid-February, was delayed due to the late rains and floods that have adversely affected the tobacco crop.
Boka, Premier and Tobacco sales floor are the only auction floors licensed to sell tobacco this season.