The Sunday Mail
SMALL-SCALE tobacco farmers who rely on the auction floors to market their crop were disappointed and felt cheated by buyers during this year’s selling season.
The farmers said the prices, which ranged from a paltry USc60 to about US$3 per kg, were an insult considering the commitment and time they invested throughout the season.
They believe the low prices are the result of a well-orchestrated ploy to lure them into contract farming.
TIMB statistics after the 89-day marketing season ended June 27 showed that auction floors brought in 50,5 million kg at an average price of US$2,70 per kg; compared to 53,4 million kg after 99 days of sales averaging US$3,54 per kg in the comparative period a year ago.
Contracted tobacco for the 2014 season accounts for more than 75 percent of total tobacco sales and indications are that most of the country’s tobacco production will soon be via contracting as farmers struggle to fund their own operations.
The tobacco planting season began in early September.
Tobacco Industry and Marketing Board (TIMB) chief executive officer Dr Andrew Matibiri acknowledged the price disparities but said they cannot do anything about this without enabling legislation.
“Our figures show that the prices of tobacco bought at the auction floors are lower than what is paid to contracted farmers. Unfortunately, as TIMB, we don’t set tobacco prices; it is the buyers who set the price.
“The (Tobacco Industry and Marketing Act) does not allow us to set the prices of tobacco,” said Dr Matibiri.
He, however, said auction prices tended to be lower because the crop there was of poor quality when compared to contracted farme rs’ produce.
Dr Matibiri also said when contractors “get enough tobacco from the farmers they contracted”, they won’t be motivated to go and buy from the auction floors, thus further driving down prices.
“If you checked in 2009 and 2010, auction prices were actually higher than contract prices but the trend has changed now.
“There is not much we can do with the prices at the auction floors; they will remain like that until probably when the Act is amended to allow us to set the prices,” he said.
Tianze Tobacco Company’s assistant to managing director Mr Li Wenjie said contract farmers got fair value for their crop as it was of good quality.
“Contract farmers produce polished tobacco because they have good management skills of their crop because they are provided inputs.
At the auction floors, it is mostly small-scale farmers who grow one hectare or even half-a-hectare and they do not have money to take care of their crop, hence, the low prices they get. It is not like we want to pay less,” said Mr Li.
A Mashonaland Tobacco Company official said prices were competition-driven.
“Our buying policy is that we buy at contract and only buy at auction to augment . . . More so, at auction we do not buy everything; we buy what we need while at contract we buy everything (all grades) farmers bring because we would have funded them.
He went on: “You find that the price of tobacco at auction is often very low because the farmers do not use proper curing facilities, chemicals and other important inputs.”
The official denied that the low prices at auction floors were designed to force farmers to contract farm.
Mr Davet Muzvidzwa of the Zimbabwe Progressive Farmers’ Union said auction prices were low because “at the auction floors, it is anyone’s game while with contract farmers, you want to retain them”.
Analysts say while Zimbabwe’s tobacco output from the 2013/14 season rose to 216 million kg from 164 million kg in the 2012/13 season, the crop’s quality fell.
Tens of thousands of small-scale farmers are growing tobacco but lack expertise and funding.
However, TIMB technical services director Mr Meanwell Gudu said it would not be long before these farmers started bringing a quality crop.
