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Tobacco deliveries increase, prices firm

by Staff reporter
06 May 2020 at 07:38hrs | Views
The volume of flue-cured tobacco being delivered to the floors continues to increase as prices firm. By day three of the opening of the 2020 marketing season, farmers had sold 694 496 kilogrammes of tobacco worth US$1,6 million with contact floors offering prices above US$5 per kilogramme.

Tobacco Industry and Marketing Board (TIMB) seasonal sales statistics have shown that volumes of the crop sold at both auction and contract floors had increased by 333 percent from 160 080 kilogrammes during the same period last year, while earnings also increased by 588 percent to US$1 598 230 this season from US$232 008 last season.

The bulk of the crop sold so far came through the contract floors. A total of 657 160 kilogrammes worth US$1 533 369 have been sold through the contract floors while 37 336 kilogrammes worth US$64 861 have been sold at auction floors. Contract floors have also offered the highest price of US$5,30 per kg, while the highest price at the auction floors is US$4,21 per kilogramme.

The average price at the contract floors is US$2,33 per kg compared to US$1,74 per kg offering buyers at the auction floors. Tian Ze director and administration manager, Mr Wenjie Li said the 2020 tobacco marketing season started well for the contract market.

"The marketing season has started well although the volumes of tobacco being delivered by farmers is a bit lower than the previous season due to Covid-19. The quality of tobacco received from our contract farmers has improved and the prices have continued to be firm," he said.

The 2020 marketing season opened last week, a month later compared to the 2019 season, which commenced end of March. The season could not open during the normal days because of Covid-19.

TIMB licensed three tobacco auction floors —  Tobacco Sales Floor, Boka Tobacco Floors and Premier Tobacco Auction Floors. The board also licensed 32 A class buyers and 33 contract buyers. Government is encouraging decentralisation of tobacco floors.

Statutory Instrument 94 of 2020 encourages the decentralised selling of tobacco and said this should be the main thrust of the industry from now and ahead as this reduces crowds in Harare and is also in line with Government policy of devolution.

Source - the herald