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  • Zimbabwe Working to Stabilize Tobacco Market After Rocky Start

    Zimbabwe Working to Stabilize Tobacco Market After Rocky Start

    Zimbabwe’s Tobacco Industry and Marketing Board (TIMB) said it is working to stabilize the market as the 2026 season has gotten off to a rocky start, with early prices plummeting due to global oversupply and slow buyer participation. After two weeks, the average price had dropped 24% from last season to $2.66 per kg, with some bales selling for as little as 10 cents per kg.

    TIMB chief executive Emmanuel Matsvaire said several major merchants, who fund 85% of the crop, had not finalized their credit facilities by the time the market opened, creating a void of competition that allowed prices to bottom out. With those companies back in the fold, Matsvaire said the increased participation is helping prices trend upward. The board is also emphasizing better market intelligence to align Zimbabwe’s production with global demand, aiming to restore confidence among the country’s 100,000-plus growers

    Coming out of a record-shattering 2025 season where it produced 355 million kg of tobacco, Zimbabwe encouraged farmers to push for a national output of 400 million kg this year. However, China, the largest consumer of Zimbabwean leaf, reportedly lowered its orders by more than 10 million kg, sending TIMB to aggressively seek new export markets in the Middle East, Africa, and EU.

  • TIMB Keeping Tobacco Money Home, Limiting Unregulated Sales

    TIMB Keeping Tobacco Money Home, Limiting Unregulated Sales

    With 67% local financing in place, Zimbabwe has nearly reached its goal of reducing reliance on offshore funding that limits domestic tobacco value retention, according to the Tobacco Industry and Marketing Board (TIMB). TIMB set the goal of 70% local financing, as officials estimate that under external financing models, for every U.S. dollar financed, only 12 cents remains in the country. Tobacco remains the country’s largest agricultural export and second-largest foreign currency earner after gold, generating about $1.2 billion last year.

    Tobacco output exceeded expectations last year, reaching 355 million kg against a 300 million kg target, with projections of around 400 million kg this year, with more than 90% of tobacco under contract arrangements. While production growth has been strong, value addition remains subdued at 10.78% against a 30% target.

    TIMB has also introduced tougher penalties and a biometric grower management system ahead of the new marketing season, significantly raising fines for regulatory breaches. Farmers caught engaging in side marketing will be fined $50 per bale, up from $20, while merchants purchasing such tobacco will pay $200 per bale. Illegal buying point operators, known as “Makoronyera,” risk fines of up to $2,000.

    TIMB confirmed that 48 contractors and 46 Class A buyers have been licensed for the 2026 season, with grading categories streamlined to enhance global competitiveness amid evolving climatic and market conditions. Five firms were barred over compliance issues.

  • Herzog Talks Industry Shifts, Expects Market to Hit $67B by 2035

    Herzog Talks Industry Shifts, Expects Market to Hit $67B by 2035

    Goldman Sachs Managing Director Bonnie Herzog described the U.S. nicotine market as “attractive and growing,” projecting total revenues to reach about $67 billion by 2035 as the profit pool shifts decisively toward smoke-free products. Speaking last week at CSP’s Convenience Retailing University, she said cigarettes, which currently generate about 70% of industry operating profit, are expected to fall to roughly 50% by 2035, with smoke-free categories becoming the primary engine of profit growth due to stronger unit economics. Smoke-free products already account for about 48% of U.S. nicotine volumes, a figure she expects to rise to around 75% over the next decade, driven by downtrading and cross-category movement.

    On e-vapor, Herzog said illicit products represent roughly 70% of the market today, a dynamic she said is suppressing growth in the formal channel and weighing on retailer sentiment amid limited enforcement. While she expects illicit penetration to decline over time, she cautioned that vapor will likely underperform other reduced-risk categories until enforcement improves, adding that British American Tobacco is positioned to remain the largest branded player.

    In modern oral, Herzog forecast nicotine pouches to reach nearly $11 billion in revenue by 2035 and become the second-largest category by volume behind e-vapor. She highlighted continued momentum for Zyn from Philip Morris International, citing retailer survey data showing strong fourth-quarter gains supported by promotions, and described Velo Plus from Reynolds American Inc. as a “fierce” competitor in the expanding pouch segment.