Tag: Zimbabwe Tobacco Association

  • Farmers Demand Full U.S. Dollar Retention

    Farmers Demand Full U.S. Dollar Retention

    Photo: Taco Tuinstra

    Zimbabwean tobacco farmers have asked the government to allow them to retain 100 percent of their earnings in U.S. dollars in the upcoming selling season, reports The Herald.

    The request comes after the Reserve Bank of Zimbabwe (RBZ) announced tobacco growers will be paid only 75 percent of their sale proceeds in foreign currency in the 2023-2024 season. The remaining 25 percent is to be settled in local currency at the prevailing interbank market rate.

    This ratio is down from the 85/15 percent split that applied in the 2022-2023 season.

    Zimbabwe Tobacco Growers Association (ZTGA) Chairman George Seremwe said tobacco farmers need to retain all of their earnings in foreign currency because their production cost, too, are foreign-currency based. Under the prevailing split, farmers struggle to turn a profit, according to Seremwe.

    Zimbabwe Tobacco Association CEO Rodney Ambrose concurred. “Tobacco production costs are already 90 to 100 percent dollarized. Last season’s 85 percent retention assisted in improving growers’ viability, more so given the flattening out of farmers tobacco prices and increased costs of production,” he said.

    “Contractors have lent out almost 100 percent of their loans in foreign currency to farmers, anything less than the current 85 percent retention will negatively impact on growers’ viability.”

    “It’s unfortunate that 75/25 split portion reverses the gains made, we hope that the policy will change in February 2024,” said Tobacco Farmers Union Trust President Victor Mariranyika. “This previous season’s 85 percent retention was not enough for farmers, so we were looking forward to 100 percent foreign currency retention in the 2024 marketing season,” he said.

    Under the Tobacco Value Chain Transformation Plan, Zimbabwe aims to sustainably produce 300 million kilograms of flue-cured tobacco by 2025. In 2023, the country’s farmers produced 296 million kg and earned $897 million.

    A Nov. 10 report by the Tobacco Industry and Marketing Board (TIMB) shows the number registered tobacco growers declined by a quarter for the 2023-2024 season.

  • Zimbabwean Farmers Bemoan Power Cuts

    Zimbabwean Farmers Bemoan Power Cuts

    Photo: Taco Tuinstra

    Power cuts  in Zimbabwe are impacting irrigation and increasing tobacco farmers’ production costs, reports The Herald, citing Zimbabwe Tobacco Association (ZTA) CEO Rodney Ambrose.

    “Power outages from about 0500 hours in the morning to as late as 2200 hours are a major concern in most growing areas at the moment,” Ambrose was quoted a saying. “Growers are struggling to complete their irrigation cycles and are relying on diesel powered generators, incurring huge costs.”

    Ambrose said the crop quality, yield and grower viability would likely be compromised as the option of running generators for irrigation is not sustainable. With curing of the irrigated crop scheduled to start in early December power demand will increase further.

    “We are engaging with the power utility to identify clusters where power supply can be prioritized just like they did for the wheat program. However, if power deficits persist nationally, the cluster solution may not entirely resolve the issue. The next option is to plead with the government to provide subsidized diesel or allow duty free imports of fuel primarily for powering generators,” said Ambrose.

    Ambrose believes the long-term solution is for farmers to transition to solar power although this has a costly outlay that requires growers to have access to long term financing.

    It will also require the government to permit duty-free and tax-free imports of solar equipment for farming activities, he added.

    Tobacco farmers have planted 22,298 hectares this season, including 16,962 hectares of irrigated tobacco, according to the Tobacco Industry and Marketing Board.

    The report said 105,805 growers had been registered so far compared to 133,724 registered growers during the same period last year, marking a 26 percent decline.

  • ITGA Calls Attention to Growers’ Viability

    ITGA Calls Attention to Growers’ Viability

    Photo: ITGA

    During a recent tour of Africa’s leading tobacco growing country’s José Javier Aranda, the president of the International Tobacco Growers Association (ITGA), stressed the importance of sustainability and grower viability.

    “Sustainability starts by securing viability to growers; without it, the very pillar of the sector is at risk,” he said.

    A fifth-generation tobacco grower in Salta, Argentina, Aranda shared examples to improve social and environmental conditions in tobacco growing that had been successfully implemented in his home country. He cited the contributions of Argentina’s Special Tobacco Fund, which has allowed local growers to remain viable and reinvest in social, economic and environmental initiatives.

    As part of his tour, Aranda attended TAMA Farmers’ Trust annual general meeting in Lilongwe, Malawi, which was opened by Malawi’s minister of agriculture, Dalitso Kawale. During the gathering, Aranda stressed the need for governments and grower bodies to work against the demonization of the sector.  

    Another key point of discussion was the conference of the parties to the World Health Organization’s Framework Convention on Tobacco Control, which will take place in Panama in November (COP10). The ITGA has been campaigning to counter the claims raised by WHO about tobacco farming and about the economic viability of alternatives crops.

    “WHO FCTC operates against its own rules of procedure and under Article 5.3 is deliberately excluding the tobacco farmers’ voice and other tobacco sector key players from the discussion,” said Aranda. “This is the main reason why Article 17 (economically viable alternatives to tobacco growing) has not seen any evolution.

    “Article 17 has not provided any results in the search of viable alternative crops in the great majority of tobacco growing countries. Growers are already planting complementary crops whenever the conditions are provided. We urge the WHO FCTC to apply a pragmatic approach towards this issue. ITGA and its member associations are ready to cooperate.”

    In Harare, Zimbabwe, the ITGA attended the Zimbabwe Tobacco Association’s annual general meeting and conducted its 2023 Africa regional meeting, officially opened by Minister of Agriculture Anxious J. Masuka. Representatives of four leading tobacco-growing countries attended these meetings: Malawi, Tanzania, Zambia and Zimbabwe, while the public session was joined by key partners and stakeholders in the sector. 

    During the ITGA Africa regional meeting closed session, growers’ representatives presented reports highlighting the key dynamics in their respective markets. Tobacco growers in Malawi have strengthened their efforts in producing a compliant crop, for example, while in Zimbabwe, the current sustainability focus is on curing fuels, agricultural labor practices and traceability.

    Earlier in June, ITGA CEO Mercedes Vázquez participated in several events in Tanzania, hosted by Tobacco Cooperative Joint Enterprise. Among other parties, she met Tanzania’s minister of agriculture, Hussein M. Bashe and the Tanzania Tobacco Board.

  • Zimbabwean Farmers Anticipate High Prices

    Zimbabwean Farmers Anticipate High Prices

    Photo: Taco Tuinstra

    Tobacco farmers in Zimbabwe are expecting high marketing prices this year following a good growing season and improved curing methods, reports The Herald

    “Our assessment of the tobacco crop to date promises higher yields and improved quality. This view is shared by a number of contractors,” said Rodney Ambrose, CEO of the Zimbabwe Tobacco Association. “It is in this regard that we are anticipating average prices to be firmer this season.

    “There is also a level of increased demand for the crop, so this will help lift the average prices.”

    “Farmers are anticipating high prices as the quality of the crop in the field is very good,” said Shadreck Makombe, president of the Zimbabwe Commercial Farmers Union. “All that is left is for farmers to do proper curing. We encourage farmers not to be extravagant and [to] save their hard-earned money and be able to finance next season’s operations.”

    “The 85 percent foreign currency retention increase is surely going to put more money in farmers’ pockets,” said Makombe.

    According to Edward Dune, vice president of the Tobacco Farmers Union Trust, all farmers are looking forward to a rewarding season. “The playground has to be level in terms of pricing,” he said. “Let the price matrix reward on the basis of quality. No merchant should be a farmer’s favorite given that some are paying more for the same quality to avoid side marketing.”

    The Tobacco Farmers Union Trust is lobbying for viable prices to enhance sustainability, according to the organization’s president, Victor Mariranyika.