Malawi’s tobacco revenue and volume at the national level have doubled in the second week of trading the leaf, official statistics compiled by the Tobacco Control Commission (TCC) have shown.
As at 22nd March, 2013, tobacco, Malawi’s main export commodity, had earned the country through auctioning and contract sales $6.8 million (about K2.7 billion) compared to foreign currency worth $3.1 million (about K1.2 billion) earned in the first week of the market.
So far, as of Friday last week, about 5.4 million kilogrammes of tobacco was sold which is 125 percent higher than the 2.4 million kilogrammes sold in the first week.
The tobacco average price has also marginally improved in the second week of trading $1.27 (about K508), slightly higher than the average price of $1.25 (about K480) in the first week.
According to the TCC statistics, tobacco revenue, volume and the average price realised on the market so far represents 216 percent, 161 percent and 21 percent higher than what was realised in the same periods last year.
If such market dynamics persists throughout the marketing season, the country could register one of the most successful tobacco seasons in so many years and boost Malawi’s foreign exchange position which has been precarious in recent years.
The Joyce Banda administration this year expects over $300 million in tobacco revenue.
In an interview on Monday, TCC spokesperson Juliana Chidumu said TCC is excited with the market performance so far and expressed hope that the trend will continue for the rest of the marketing season.
“It is a positive development and we are excited. Prices have started on a positive not this year and have surpassed the performance of last year. We are working hard to ensure that this trend continues,” said Chidumu.
Chidumu also urged tobacco growers to appreciate improved tobacco prices on the market and not smuggle the leaf to other countries a situation which he says makes Malawi to lose out the much-needed foreign currency.
She also reiterated that the weakening of the kwacha currency against international currencies, especially the United States dollar, should benefit tobacco growers as it would boost their earnings per each kilogramme.
When the market opened on Monday last week at the Lilongwe Auction Floors, prices fetched as high as $2.20 (about K8,80) per kilogramme with the minimum price spotted by Business News being around 90 cents (about K360) per kilogramme.
Last year, both the volume and revenue from the leaf tumbled miserably to 79.8 million kilogrammes and $177 million from a volume of 236 million kilogrammes and $292 million realised in the previous year, respectively.
Available statistics show that tobacco is contributes 25 percent to Malawi’s gross domestic product (GDP) and employs up to 12 percent of the entire population.
According to TCC, this means that tobacco still remains our main source of economic livelihood at micro level as well as an engine of growth at macro level.