News / National
Zimbabwe targets US$ 1,6bn tobacco exports
04 Aug 2023 at 01:37hrs | Views
Zimbabwe has so far exported over 98 million kg of tobacco since the start of the marketing season as the country makes strides towards achieving its target of over US$1,6 billion in total exports, a major increase from US$900 million obtained in 2022 season.
Export values include both what is paid to farmers for growing, curing and grading the crop, and what is earned by the merchants for subsequent extra processing, packing, application of their skills in meeting precise orders from their customers, and the final dispatching.
About US$502 million has so far been achieved from exporting tobacco compared to US$417 million by this time last year, a major increase of 20 percent.
This season 294 million kg of tobacco valued at US$890 million to the farmers has been sold compared to 203 million kg valued at US$621 million paid to farmers last year which is the largest ever crop, and most valuable crop, in the history of Zimbabwe since tobacco growing started. The merchants will now be adding their value to this crop, almost doubling its value, before it reaches the final customers.
Lands, Agriculture, Fisheries, Water and Rural Development Permanent Secretary, Dr John Basera said the country is going for growth in the agriculture sub-space adding that this year the tobacco yield is the highest and best ever produced in the country.
This hectarage is followed by the 2019 yield where 259 million kg of tobacco was recorded during the 2019 selling season.
"In terms of exports from our leaf we are projecting over US$1,6 billion compared to US$900 million achieved in 2022 last year so we are going for growth in every aspect. My expectations are very high, we need to go for better growth,''he said.
Zimbabwe is optimistic that this year's tobacco exports will surpass 199 million kg exported last year following good rains countrywide which boosted the production of the crop.
Tobacco Industry and Marketing Board (TIMB) public relations officer, Mrs Chelesani Tsarwe described this year's marketing season as a success because of the crop quality produced.
She applauded the stakeholders for complying well to regulatory laws by the board to ensure a smooth running of the season.
"The season was good, the crop quality was also good and so are the prices. Farmer payments are being done on time as compared to previous seasons. Overall, there was orderly tobacco marketing and stakeholders are adhering to the board's compliance frameworks," she said.
Mrs Tsarwe is anticipating that more tobacco will be exported compared to last year. Farmers are well prepared and anticipating another good tobacco season which is currently underway.
Tobacco Farmers Union Trust vice president Mr Edward Dune said it is critical for the Government to empower smallholder farmers so that they will not depend on contracting companies.
He also said TIMB as a regulator should also contract genuine contractors who are reliable to the farmers."
"If Government continues to empower smallholder farmers like in the case of Pfumvudza, then farmers are assured of getting inputs on time. Unscrupulous middlemen should totally be eliminated to ensure that farmers get what they actually deserve.
"Tobacco has transformed the majority of people, but there is a need to ensure that processing is done in the country to ensure that our farmers get more money," he said.
Tobacco Farmers Union Trust president Mr Victor Mariranyika said tobacco is the biggest foreign currency earning crop which needs a practical action approach when growing it.
"Contracting companies should provide enough inputs and on time to ensure that best results are achieved. Several smallholder farmers' lives have totally positively changed, and production costs should not rise to ensure that farmers get a profit,'' he said.
Mrs Marjorie Makwiza of Banket said of all the crops, tobacco has positively transformed her life and her children.
"Since l started growing tobacco, everything almost changed. It was difficult to send my children to school or even to feed them but now l can testify that everything is now moving smoothly. I earn large amounts of money every year.
"So far no challenges I am facing. Every year l grow more than 20 bales. To me tobacco has transformed my life and next year I am planning to increase the hectarage because of 85 percent foreign currency retention which was introduced by the Government. This is a motivating initiative," she said.
Mr Tawanda Marembo of Raffingora also mentioned that all his wealth emanated from growing tobacco.
"I started growing tobacco in 2018, but I can tell you that I bought a car, tractor and I built a nice house in Chinhoyi. Tobacco pays if good agronomic practices are implemented. This crop has transformed my life and I pledge to continue growing tobacco. Other crops are paying but tobacco has proved to be the biggest paying crop," he said.
Tobacco is exported throughout the year although the bulk of the crop is bought from contracted farmers.
Merchants then process, grade and store the leaf exporting shipments as orders flow in. Zimbabwe was generating US$1 billion annually from tobacco exports and the sector has in recent years been critical in sustaining the economy through improving the much-needed foreign currency reserves.
Considerable value is added locally to the crop before export.
Tobacco merchants do much initial processing, such as removing stalks and getting water content right, and then assemble orders of the exact required grades and quantities.
Finally there are storage, transport and insurance additions to value.
China is the largest export destination, accounting for between 40 and 45 percent of total tobacco exports. The role and potential of the sector to stir economic growth and subsequent transformation of livelihoods for Zimbabweans is massively significant.
Prior to land reform, more than 95 percent of the total national flue-cured tobacco came from about 2 000 growers in the large-scale farming community. Land reform after an initial decrease then allowed rapid expansion as new smallholder farmers took up the strain. Generally a smallholder will produce a better quality on average, since they can examine their entire planted hectarage very frequently and take remedial action more promptly.
This is seen in the fact that the top price in the contracted crop, which smallholders dominate, is invariably higher than the top price earned on the auctions.
The Second Republic accelerated the growth with the Tobacco Value Chain Transformation Plan (TVCTP) launched in 2021.
The TVCTP (2021-2025) seeks to secure the future and consolidate the important role of the tobacco value chain to agriculture and the economy through sustainable intensification of tobacco production to 300 million kilogrammes; enhancing transparency and fair tobacco marketing, expanding into new markets in the Middle East and reforming, restructuring and rebuilding existing institutions in order to optimise tobacco value chain financing so as to raise and optimise the net export benefits from tobacco from the current 12.5 percent of exports to 70 percent by 2025.
The Ministry is also facilitating imports of farm machinery and equipment in order to mechanise and modernise the sector.
Export values include both what is paid to farmers for growing, curing and grading the crop, and what is earned by the merchants for subsequent extra processing, packing, application of their skills in meeting precise orders from their customers, and the final dispatching.
About US$502 million has so far been achieved from exporting tobacco compared to US$417 million by this time last year, a major increase of 20 percent.
This season 294 million kg of tobacco valued at US$890 million to the farmers has been sold compared to 203 million kg valued at US$621 million paid to farmers last year which is the largest ever crop, and most valuable crop, in the history of Zimbabwe since tobacco growing started. The merchants will now be adding their value to this crop, almost doubling its value, before it reaches the final customers.
Lands, Agriculture, Fisheries, Water and Rural Development Permanent Secretary, Dr John Basera said the country is going for growth in the agriculture sub-space adding that this year the tobacco yield is the highest and best ever produced in the country.
This hectarage is followed by the 2019 yield where 259 million kg of tobacco was recorded during the 2019 selling season.
"In terms of exports from our leaf we are projecting over US$1,6 billion compared to US$900 million achieved in 2022 last year so we are going for growth in every aspect. My expectations are very high, we need to go for better growth,''he said.
Zimbabwe is optimistic that this year's tobacco exports will surpass 199 million kg exported last year following good rains countrywide which boosted the production of the crop.
Tobacco Industry and Marketing Board (TIMB) public relations officer, Mrs Chelesani Tsarwe described this year's marketing season as a success because of the crop quality produced.
She applauded the stakeholders for complying well to regulatory laws by the board to ensure a smooth running of the season.
"The season was good, the crop quality was also good and so are the prices. Farmer payments are being done on time as compared to previous seasons. Overall, there was orderly tobacco marketing and stakeholders are adhering to the board's compliance frameworks," she said.
Mrs Tsarwe is anticipating that more tobacco will be exported compared to last year. Farmers are well prepared and anticipating another good tobacco season which is currently underway.
Tobacco Farmers Union Trust vice president Mr Edward Dune said it is critical for the Government to empower smallholder farmers so that they will not depend on contracting companies.
He also said TIMB as a regulator should also contract genuine contractors who are reliable to the farmers."
"If Government continues to empower smallholder farmers like in the case of Pfumvudza, then farmers are assured of getting inputs on time. Unscrupulous middlemen should totally be eliminated to ensure that farmers get what they actually deserve.
"Tobacco has transformed the majority of people, but there is a need to ensure that processing is done in the country to ensure that our farmers get more money," he said.
Tobacco Farmers Union Trust president Mr Victor Mariranyika said tobacco is the biggest foreign currency earning crop which needs a practical action approach when growing it.
"Contracting companies should provide enough inputs and on time to ensure that best results are achieved. Several smallholder farmers' lives have totally positively changed, and production costs should not rise to ensure that farmers get a profit,'' he said.
Mrs Marjorie Makwiza of Banket said of all the crops, tobacco has positively transformed her life and her children.
"Since l started growing tobacco, everything almost changed. It was difficult to send my children to school or even to feed them but now l can testify that everything is now moving smoothly. I earn large amounts of money every year.
"So far no challenges I am facing. Every year l grow more than 20 bales. To me tobacco has transformed my life and next year I am planning to increase the hectarage because of 85 percent foreign currency retention which was introduced by the Government. This is a motivating initiative," she said.
Mr Tawanda Marembo of Raffingora also mentioned that all his wealth emanated from growing tobacco.
"I started growing tobacco in 2018, but I can tell you that I bought a car, tractor and I built a nice house in Chinhoyi. Tobacco pays if good agronomic practices are implemented. This crop has transformed my life and I pledge to continue growing tobacco. Other crops are paying but tobacco has proved to be the biggest paying crop," he said.
Tobacco is exported throughout the year although the bulk of the crop is bought from contracted farmers.
Merchants then process, grade and store the leaf exporting shipments as orders flow in. Zimbabwe was generating US$1 billion annually from tobacco exports and the sector has in recent years been critical in sustaining the economy through improving the much-needed foreign currency reserves.
Considerable value is added locally to the crop before export.
Tobacco merchants do much initial processing, such as removing stalks and getting water content right, and then assemble orders of the exact required grades and quantities.
Finally there are storage, transport and insurance additions to value.
China is the largest export destination, accounting for between 40 and 45 percent of total tobacco exports. The role and potential of the sector to stir economic growth and subsequent transformation of livelihoods for Zimbabweans is massively significant.
Prior to land reform, more than 95 percent of the total national flue-cured tobacco came from about 2 000 growers in the large-scale farming community. Land reform after an initial decrease then allowed rapid expansion as new smallholder farmers took up the strain. Generally a smallholder will produce a better quality on average, since they can examine their entire planted hectarage very frequently and take remedial action more promptly.
This is seen in the fact that the top price in the contracted crop, which smallholders dominate, is invariably higher than the top price earned on the auctions.
The Second Republic accelerated the growth with the Tobacco Value Chain Transformation Plan (TVCTP) launched in 2021.
The TVCTP (2021-2025) seeks to secure the future and consolidate the important role of the tobacco value chain to agriculture and the economy through sustainable intensification of tobacco production to 300 million kilogrammes; enhancing transparency and fair tobacco marketing, expanding into new markets in the Middle East and reforming, restructuring and rebuilding existing institutions in order to optimise tobacco value chain financing so as to raise and optimise the net export benefits from tobacco from the current 12.5 percent of exports to 70 percent by 2025.
The Ministry is also facilitating imports of farm machinery and equipment in order to mechanise and modernise the sector.
Source - The Herald
