Tobacco selling farmers, RBZ brace for a clash

OWINGS, MD - SEPTEMBER 29: Hank Jefferson loads tobacco leaves onto a trailer before being hung to dry in a barn after being harvested at Lewis Farm September 29, 2014 in Owings, Maryland. Tobacco has been grown on the Lewis Farm for over 60 years and still requires to be harvested by hand. Starting next month the remaining tobacco growers in the U.S. will be forced to compete in the open market and will stop getting buyout checks from cigarette makers to compensate them for surrendering their quotas. (Photo by Mark Wilson/Getty Images)
Photo by Mark Wilson/Getty Images)
Nqobile Bhebhe, Harare

TOBACCO farmers in Zimbabwe could be  headed for what is now an annual fight with the Reserve Bank of Zimbabwe (RBZ) after the apex bank set daily cash withdrawal limit at $300 during the 2018 tobacco marketing season which kicks off on March 21.

It has been a norm over the years for tobacco farmers to stage protests at auction floors over the cap and  delays by banks  in processing their payments.

In 2017, farmers demanded $1000 daily withdrawal limit.

This week, in a statement, the central Bank said the daily withdrawal limit will ensure a smooth payment system that is consistent with international best practice.

“This shall be disbursed at all banks stationed at the auction floors upon presentation of the respective sales statements by the tobacco growers” Governor John Mangudya said.

“The balance shall be transferred into the grower’s bank account or mobile money wallet,”.

The Tobacco Industry and Marketing Board (TIMB) set three auction floors for the 2018 tobacco selling season.

To date, 27 buyers have been registered, TIMB corporate communications manager Isheunesu Moyo  indicated.

Tobacco is the country’s second largest foreign currency earner.

Export destinations for Zimbabwean tobacco include China, South Africa, Korea, Sudan, Hong Kong, Indonesia, Philippines, United Kingdom, Spain, New Zealand and Egypt.

“All stakeholders are advised that the 2018 auction tobacco marketing season starts on Wednesday March 21, 2018” said Moyo

“Contract tobacco sales will start on Thursday March 22, 2018. Sales bookings will open on Wednesday March 7, 2018 and deliveries accepted as from Monday March 12, 2018,”

According to Moyo, Boka Tobacco Auction Floor, Tobacco Sales Floor and Premier Tobacco Auction Floor will do the business.

About $500 million is said to have mobilised towards the purchasing of the golden leaf.Farmers have been urged to sell their crop through the formal channels and not to middlemen. Tobacco production has been on increase due to the favourable prices offered by buyers, especially under contract farming.

However, while tobacco production has been improving it has not eclipsed a record high of 236,13 million kg marked in year 2000 .

In 2001, a total of 202,5 million kg was sold. The decline continued in 2003 to 2005 when 81,8 million kg, 69,1 million kg and 73,3 million kg were respectively sold. In 2006, 55,5 million kg were sold while only 73, 5 million kg were delivered in 2007.

In 2010, 123,5 million kg of tobacco worth US$355,7 million went under the hammer. The figures surged to 132,5 million kg as tobacco valued at $361,5 million was sold in 2011.

In 2012, 144,5 million kg valued $540 million increasing to 166,7 million kg worth $610 million in 2013.

As the appetite for growing the crop increased, in 2014, 216,2 million kg of the crop was sold, realising $685,2 million.

In 2015, tobacco output was 199 million kg raking in $867 million.