Zimbabwe’s tobacco production is expected to rise 8.5% year-on-year to 230 million kg in 2023 following good rains and as more farmers planted the crop, the industry regulator said on Wednesday.
“It looks like we are going to have a good crop. We are expecting 230 million kg,” Tobacco Industry Marketing Board (TIMB) Chairman Patrick Devenish said at the opening of the 2023 marketing season.
Tobacco is one of the biggest export earners in Zimbabwe, which aims to increase production to 300 million kg by 2025. Its output peaked at 261 million kg in 2019.
The sector contributes nearly US$1 billion to export earnings every year, Vice President Constantino Chiwenga said on Wednesday. Government statistics showed it accounted for more than 12% of exports in January.
Tobacco land use grew to 117,000 hectares this year from 110,000 hectares in 2022, according to the TIMB. The industry also saw an increase in the number of tobacco farmers to 148,527 this year from 123,000 in 2022.
Zimbabwe is currently implementing a “Tobacco Value Chain Transformation Plan”, which seeks to increase tobacco production and local processing and curb the export of unprocessed tobacco.
“We seek to localise the financing of tobacco. We wish to transform the tobacco sector so we don’t export value,” Agriculture Minister Anxious Masuka said.
“This industry is on the cusp of growth.”
Tobacco prices opened at US$4.35 at the start of the new marketing season, up from US$4.20 last year.
Tobacco farmers will be paid 85% of their sales in US dollars, up from 75% last year.
Some 95% of all tobacco production is on credit secured from contractors, with auctions accounting for the small remainder. This means that, in real terms, Zimbabwe is not getting the bulk of the money from tobacco sales.
A US$60 million fund announced two years ago to localise tobacco funding is yet to be released, farmer groups say.
Reuters (additional reporting by newZWire)