TobaccoReporter logo

Tag: Tanzania

  • Tanzanian Tobacco Growing

    Tanzanian Tobacco Growing

    Tobacco is Tanzania’s top export for the second straight year, totaling $517.1 million in 2024, up from its previous record of $340.4 million in 2023, according to the Bank of Tanzania. Tobacco passed traditional “king” crops cashew nuts and tobacco two years ago and now accounts for more than a third of the country’s agricultural exports, as Tanzania becomes Africa’s second-largest tobacco producer behind only Zimbabwe.

    With heavy support from the government — providing significant subsidies, working with leaf companies to purchase the crop, and investing in tobacco processing infrastructure — Tanzania’s market is expected to continue its growth, projected to produce $667.9 million in 2025 and continue growing at an annual rate of 3.44% until it reaches $764.8 million in 2029.

    Agriculture Minister Hussein Bashe has emphasized the importance of fair practices within the local tobacco industry. The government has initiated crackdowns on exploitative practices by cooperative leaders to ensure that farmers receive equitable compensation for their produce. There is also a $300 million cigarette factory being constructed in Morogoro to enhance the nation’s processing capacity and ensure the farmers always have a viable market.

  • Tanzania Tobacco Exports Hit $438 Million

    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.

  • Tanzania President Lays First Stone for Factory

    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.

  • PMI To Build Cigarette Factory in Tanzania

    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.”

  • Tanzania Targets Illicit Drug Sales

    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.”

  • Tanzania Tobacco Crop Size Up

    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.”

  • Dollar Shortage Delays Payments

    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. 

  • Tanzania Bank Pledges to Support Farmers

    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.  

  • BAT Prevails in Tanzania Distributor Dispute

    BAT Prevails in Tanzania Distributor Dispute

    Photo: somemeans

    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.