Flue-cured tobacco sales at Lilongwe Auction Floors sold under the auction system have been suspended due to disagreements on price, Auction Holdings Limited (AHL) corporate affairs manager Mark Ndipita confirmed.
“It [the sales] will resume after the issue [or pricing] has been resolved. The farmers’ main concern is that similar grade leaf is rejected on auction but their fellow growers sell the same quality on integrated production system [IPS],” he said.
Ndipita said growers also complained of more time spent at the floors when their leaf is rejected.
“They [farmers] are told to come to the floors for several times to check if their rejected tobacco has been reoffered, which they said is wasting their time and money as they also have other personal pressing things,” he said.
The suspension of flue-cured sales under auction comes amid cries from tobacco growers that tobacco sold under auction is allocated short time of trading than the IPS tobacco.
In a snap survey at Mzuzu Auction Floors, the growers said tobacco on auction is only sold for 30 minutes in a day than tobacco on contract.
“There are days when auction sales start at 7:30 am and finish at 8 am. We are not allocated more time to auction our leaf and this is in addition to the high rejection rate,” said one of the growers from Rumphi who has 5 000 kilogrammes of burley tobacco selling on auction.
On the rejection rate, Ndipita said the rates are now decreasing, adding that as of Monday this week, 12 percent rejection rate was registered, which is an improvement from about 30 to 40 percent in the past.
While the farmers are seeing a bleak future on tobacco sold under auction system, Ndipita said the future is bright because of government policy that auction selling should be done side by side with tobacco sold under contract system.
Tobacco Association of Malawi (Tama) chief executive officer Graham Kunimba said there is need to civic educate growers that sales depend on quantity.