HomeBusiness DigestTobacco sales exceed govt projections

Tobacco sales exceed govt projections

Staff Writer

THE tobacco selling season closed last week with sales volumes 6,1% above the government revised projection of 130 million kg.
Sales volumes for the season totalled 137,5 million kg valued at US$507,2 million.
This is 45% and 8,3% ahead of last year’s US$348,7 million and 12,9 million tonnes recorded value and sales  volumes, respectively.
Tobacco output was this year initially projected at 150 million kg but was later revised downwards to 130 million kg owing to a decline in the planted hectarage and bad weather.
Prices for the season closed 34,2% firmer at an average of US$3,69 compared to US$2,75 last year.
Contract sales accounted for 63% of volumes and totalled 86,3 million kg with a value of US$325,6 million compared to auction sales volumes amounting  to 51,2 million kg sold at US$181 million.
The Medium-Term Plan (MTP) forecasted tobacco output at 180 million kg this year, which could not be achieved due to limited funding in the sector, among other reasons.
The tobacco industry needs US$200 million in fresh capital to return to peak production record of 237 million kg recorded in 2000.
The agriculture sector continues to face a  myriad of challenges  as evidenced by Finance minister Tendai Biti’s  mid-term review policy, projecting  the sector to  decline  by  5,8% largely weighed down by poor performance of maize and wheat production which declined by  4,7%  and 2,5% respectively.
Biti said economic growth has thus been revised down to 5,6% compared to 9,4% partly due to poor performance of the agriculture sector.
He said in order to reverse the decline in the sector and sustain agro-processing industries, government would have to focus on the timely supply of inputs, financing and clarify marketing arrangements for the coming season.
Biti said resolving outstanding issues on land tenure was  important in facilitating financing for the sector and helping it  return to projected growth of 13,7% in 2013 as targeted by  the MTP.

Recent Posts

Stories you will enjoy

Recommended reading