Tag: Tanzania

Tanzania Tobacco Exports Hit $438 Million

Image: Tobacco Reporter archive
Tanzania’s tobacco export value has hit $438.5 million, more than double the previous year, according to data from the Tanzania Revenue Authority (TRA) and Bank of Tanzania (BoT), reports The Guardian.
The government’s target was $400 million.
Tobacco exports have now surpassed coffee and cashews as the leading traditional export earning commercial crop. Tobacco is currently produced under contract.
The value increase is a result of a crop production increase to 122 million kg as well as an increase in commodity price in the world market.
Tanzania is now the second largest producer of tobacco in Africa following Zimbabwe.
For the 2024/2025 season, Tanzania aims to produce 200,000 tons of tobacco, and for the 2025/2026 season, the country aims to produce 300,000 tons.
The goal is to increase export earnings to between $600 million and $700 million annually, according to Hussein Bashe, the minister of agriculture.
According to Bashe, more than 50 percent of tobacco was bought and sold abroad by local companies, marking a first for the country.
Statista projections show Tanzania’s tobacco products market generating $644.9 million in revenue in 2024.
August 14, 2024
Tanzania President Lays First Stone for Factory

Photo: The office of President Samia Suluhu Hassan
Tanzanian President Samia Suluhu Hassan on Aug. 6 laid the foundation stone for a $300 million cigarette factory in Morogoro, reports The Citizen.
The Serengeti Cigarette Co. factory will supplement the recently reopened Mkwawa leaf-processing facility, which is in the process of expanding its annual capacity from 80 million kg to 200 million kg. Upon completion, the factory will be the world’s second-largest leaf-processing facility, according to Minister of Agriculture Hussein Bashe.
During the previous administration, the Mkwawa plant ceased operations due to financial and regulatory challenges, including fines totaling TZS2 trillion ($740.66 million) imposed by The Fair Competition Commission and the Tanzania Revenue Authority.
When President Hasan’s government took office in March 2021, it annulled the fines as part of a program to revive and expand Tanzania’s tobacco business.
According to Bashe, these actions allowed tobacco production to increase from 65 million kg in 2021 to 122 million kg in the most recent growing season, catapulting Tanzania to the No. 2 position among tobacco producers in Africa, after Zimbabwe.
The ready market also boosted prices from $1.40 per kilogram three years ago to $2.40 during the just-completed season, said Bashe. Tanzania earned $400 million from tobacco exports this year.
Upon completion, the new cigarette factory will employ 12,000 permanent and seasonal positions and generate additional demand for local leaf.
Keen to reduce the environmental impact of tobacco production, Mkwawa has been encouraging farmers to dry their tobacco in the sun rather than in wood-fueled curing barns. The company aims to have at least 30 percent of its contracted farmers cure their tobacco this way.
August 7, 2024
PMI To Build Cigarette Factory in Tanzania

Photo: Taco Tuinstra
Philip Morris International will build a cigarette factory in Morogoro and buy at least 12 million kg of Tanzanian tobacco annually over the next five years, reports The Citizen. The company hasn’t purchased leaf from Tanzania since 2017.
According to Minister of Agricultura Hussain Bashe, PMI has partnered with another firm in Tanzania to build a cigarette factory, which he says may commence operations toward the end of 2024.
Tanzania tobacco farmers produced 120 million kg in the most recent growing season. This year, they are expected to cultivate 200 million kg.
Anti-tobacco groups criticized PMI’s decision to build a factory. “The announcement is yet another act of hypocrisy from the tobacco giant that claims it is committed to “delivering a smoke-free future. You don’t achieve a smoke-free future by building new cigarette factories or by shipping 613 billion cigarettes worldwide, as Philip Morris did in 2023,” said Yolonda Richardson, president and CEO of the Campaign for Tobacco-Free Kids, in a statement.
“The move by Philip Morris to double down on cigarette sales in Africa shows that the company is blowing smoke and can’t be taken seriously when claiming that it wants to end cigarette sales. Philip Morris is working to sell as many cigarettes as it can for as long as it can.”
February 23, 2024
Tanzania Targets Illicit Drug Sales

Image: KPad
Tanzania initiated a nationwide operation targeting all illicit drug selling points, pharmacies and entertainment venues where shisha is widely available, says the Drug Control and Enforcement Authority (DCEA), according to the Xinhua News Agency.
The operation will encompass land and sea areas, according to DCEA Commissioner Aretas Lyimo.
Lyimo noted that recent operations uncovered widespread cannabis cultivation in the Mara and Morogoro regions, and there were high instances of drug-related cases in Kilimanjaro and Tanga.
“The operations will encompass drug farms, border areas, distribution points and usage sites, including bars,” said Lyimo. “Anyone found using drugs, including shisha, will face legal consequences.”
January 26, 2024
Tanzania Tobacco Crop Size Up

Photo: Taco Tuinstra
Tanzania’s tobacco crop increased to 122.86 million kg in the 2023-2024 growing season, reports Daily News, citing a statement from Agriculture Minister Hussein Bashe. As of December 2022, Tanzania had earned $316 million from tobacco exports. The country aims to sell $400 million this season.
Bashe expressed confidence that Tanzania would produce 200 million kg in 2024-2025
Tanzania’s recent production figures make it Africa’s second-largest producer after Zimbabwe, which harvested nearly 300 million kg in the 2022-2023 season. Other prominent African tobacco producers are Malawi 121 million kg), Mozambique (65.8 million kg), Zambia (44 million kg) and Uganda (13 million kg).
Bashe applauded Tanzania’s farmers’ associations and tobacco companies, stating that for the first time more than 50 percent of tobacco has been bought and sold abroad by local companies.
“It was not an easy journey,” he said. “I thank all the Tobacco Board workers; we dreamed, we did it, keep pushing. We will become Africa’s No 1 producer.”
January 9, 2024
Dollar Shortage Delays Payments

Image: Tobacco Reporter archive
Tanzanian tobacco farmers are receiving delayed payments due to a shortage of U.S. dollars, reports BNN.
Stanley Mnozya, director general of the Tanzania Tobacco Board, acknowledged that the shortage of U.S. dollars has made paying farmers difficult. Higher than anticipated tobacco production surpassing market demand has exacerbated the situation.
To address the situation, Hussein Bashe, minister for agriculture, held a meeting involving farmers, tobacco buyers and banks. The minister said farmers’ payments will be finalized by the end of July. The government is making efforts to ensure the funds are available in U.S. dollars.
Alliance One Tobacco Tanzania Limited (AOTTL), however, has successfully paid more than $71.9 million to over 12,000 contracted tobacco growers this season. AOTTL made direct payments of $1.72 million as crop cess to various districts and aims to expedite payments to contracted farmers, surpassing the required 14-day payment period set by law.
Delayed payments are causing financial difficulties and affecting farmers’ preparations for the upcoming season.
July 20, 2023
Tanzania Bank Pledges to Support Farmers

Image: Tobacco Reporter archive
Tanzania’s CRDB Bank promised to continue improving agriculture financing, reports The Citizen.
The bank has loaned TZS129 billion ($53.6 million) to tobacco farming from January 2023 to June 2023.
“We recognize that agriculture is the backbone of our national economy, and we have dedicated significant efforts to support it, including our successful Fahari Kilimo account with numerous benefits,” said Xavery Makwi, CRDB’s director of credit, at the opening ceremony of the bank’s new branch in Igunga. “This branch will be the gateway to economic opportunities for the people of Igunga, helping them improve their income.”
“Many residents of this district depend on agriculture, so the opening of this branch will enhance productivity if more people can access loans with low interest rates below 10 percent provided by CRDB Bank,” said Ambassador Batilda Burian, Tabora regional commissioner.
June 26, 2023
BAT Prevails in Tanzania Distributor Dispute

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British American Tobacco Kenya has prevailed in an eight-year legal battle against a distributor in Tanzania, sparing it from paying a TZS3.2 billion ($1.4 million) court award, reports The East African.
The Tanzania Court of Appeal annulled a 2016 decision by a lower court awarding the money to Mohans Oysterbay Drinks as damages after it sued BAT Kenya over the termination of a cigarette supply contract.
Mohans claimed it had the exclusive rights to sell BAT products in Tanzania, which the cigarette maker disputed.
“In our view, there was no evidence to prove the existence of a distributorship agreement between the parties nor its breach,” said the appellant court.
Mohans started importing and supplying BAT cigarettes in Tanzania in 2000. However, in 2014, BAT awarded an exclusive distribution contract to another firm after a review of the cigarette maker’s business model.
Mohans challenged the decision in Tanzania’s high court, saying that BAT had unlawfully terminated a contract. BAT said there was no such contract.
In September 2016, the high court held that an implied contract between the parties existed in their 14 years of engagement and awarded Mohans damages for loss of goodwill and money invested in the business.
In overturning that ruling, the Court of Appeal ruled that the parties’ business relationship was “neither express nor implied agreement.”
Further, the judges said the high court had erred in its decision given that Mohans had rebuffed an attempt by BAT to formalize the distributorship agreement.
February 25, 2022
Tanzania Leaf Tobacco Sales up

Photo: Taco Tuinstra
Tobacco sales in Tanzania increased to 57 million kg in 2020-2021 from 39 million kg in 2017-2018, reports All Africa, citing Deputy Minister for Agriculture Hussein Bashe.
During 2020-2021, about eight local buying companies had entered into contracts with producers of tobacco countrywide, he said.
Bashe told Parliament the government was continuing to lure farmers by insisting on contract buying, looking for new buyers as well as looking for international markets.
He added that the government was equally eyeing the Chinese market and already the government had brought another seedling of the product and trials had been made, where the sample had been forwarded to relevant authorities for further procedures.
November 4, 2021
Tanzania: Leaf Prices Skyrocketing in Tabora

Photo: Taco Tuinstra
Tobacco leaf prices in Tanzania’s Tabora region have risen tenfold to TZS4,000 ($1.72) per kg this growing season due to the availability of reliable buyers and the quality of the product, reports the Daily News.
The price rise is a major incentive for small-scale tobacco growers in the region who are increasing their production levels to take advantage. Uyui District Executive Director (DED) Hemed Magaro noted that an increase in tobacco leaf firms have led to stiffer competition and higher prices for the best quality leaf. “There are at least five giant tobacco buyers in the region who led the addition of tobacco grades. This means that not only everybody sells, but at a reasonable price,” he said.
What’s more, extension officers have been visiting farmers throughout the growing season, giving agronomical advice and related services. This has resulted in better quality leaf.
Tobacco growers were elated by the firm prices. “Every farmer was crying last harvest season, but the situation is quite opposite at this moment,” said tobacco grower Good Nzola.
Tanzania Tobacco Board Acting Director Stanley Mnozya said the presence of reliable buyers had improved the availability and quality of tobacco seeds.
“We continue conducting farmers’ verification so that we can have an exact number and set proper means to serve them,” he said. “We have also made possible the availability of extension officers wherein a person serves at least 150 farmers. As a result, tobacco quality has been upgraded from 67 [percent] to 93 percent.”
June 18, 2021