According to figures at hand, prices fell as deliveries improved on the auction floors.
Farmers had hoped to cash in on stronger prices of the crop owing to poor crop supplies but prices have fallen from an average US$3,45 to US$2,93 per kg. The downward trend on prices began in week five.
Zimbabwe has earned US$331,1 million from the sale of 113 million kgs of flue-cured tobacco in both contract and auction systems since the beginning of the 2010 tobacco marketing season, figures released by the Tobacco Industry Marketing Board (TIMB) this week show.
Tobacco sales nearly doubled the 58 million kgs valued at US$174,4 million sold during the same period last year.
Prices of tobacco have over the past two weeks been relatively lower than last year, with the seasonal average at US$2,93 per kg against US$2,98 per kg over the same period last year.
Presenting the 2010 mid-term fiscal policy, Finance minister Tendai Biti said tobacco sales would contribute significantly to the revival of the economy. He projected that 120 million kgs of tobacco would
have been sold by the end of the selling season.
In a telephone interview this week, TIMB acting CEO, Meanwhile Gudu, said his company was yet to announce a date for the closure of the auction floors.
“(Tobacco) Deliveries are still arriving; we want to find out how many farmers are still on their way before we announce a cut-off date. Once that is taken care of, we will then announce a date,” said Gudu.
Tobacco deliveries have considerably increased from an average of around 420 000 kgs a day in the first two months of the season to an average 1,4 million kgs in June and July.
According to TIMB, the increase in deliveries has resulted in the national output target for this year’s crop being revised to 114 million kgs, from the initial target of 77 million kgs.
According to TIMB, the first statistics were drawn from an early crop assessment where most of the tobacco crop was affected by the dry spell that hit most parts of the country.
A total of 1 350 422 bales have been sold compared to 697 313 during the same period last year.
This year, 122 666 bales have so far been rejected compared to 44 407 last year.
Government hopes that internally generated sources of funding such as tobacco, diamonds and other metals’ sales will play a critical role in improving market liquidity and stabilising interest rates.