Tobacco growers still the butt of price story

Zimbabwe’s flue-cured tobacco growers are continuing to suffer the effects of lower prices, which have fallen nearly 10 percent year-on-year.

Growers sold 92.2 million kg of flue-cured for US$267.7 million at an average price of US$2.90 per kg as of May 8, according to a story by Tatira Zwinoira for Newsday Zimbabwe, relayed by the TMA and quoting Tobacco Industry and Marketing Board figures.

During the corresponding period of last-year’s sales season, growers sold 96.1 million kg of flue-cured for US$308.7 million at an average price of US$3.21 per kg.

On the basis of these figures, the average price has fallen by 9.6 percent year-on-year.

Zimbabwe’s growers are not alone in suffering from lower prices. A story last month in the BBM Bommidala Group newsletter indicated that, with sales almost completed, the average price paid to growers in the Indian state of Karnataka had been 16 percent down on that of the 2013-14 season.

The story said too that prices had fallen by 14 percent in Brazil, 10 percent in Zimbabwe, eight percent in the US and four percent in Tanzania.

It will be interesting to see whether or not these lowered prices are reflected in the prices of cigarettes; rather like lowered oil prices are eventually translated into lower fuel prices at the pumps.