Tobacco sales open on high note in limbe

Tobacco sales at Limbe Floors in Blantyre have started on a good note with farmers and stakeholders expressing satisfaction over low rejection rates and better prices offered on the opening day of the marketing season yesterday.

Random checks by Business News showed that prices ranged from 80 cents (about K586) per kilogramme (kg) to $2.20 (K1 612.06) per kg. Last year, on the opening day, prices were 80 cents and $1.40 (about K1 026.02)

Rejection rate was, on the other hand, at 1.8 percent while during the same period last year it was at 52 percent.

Tobacco Control Commission (TCC) acting chief executive officer David Luka expressed satisfaction with the start of the sales, expressing hope that the trend will continue going forward.

“We are excited with the start of this season and the commission is keen to ensuring that we continue with the pace at which we have started with.

“We have designed a system whereby there will be frequent engagements with all players not only when there is a problem but to monitor progress of the marketing season,” he said.

Luka’s sentiments concurred with AHL Group general manager for tobacco sales, Moses Yakobe, who projected that this year would be a good marketing season compared to last year.

“Last year, on the first day, the price was so poor. We had most tobacco going at $0.80 and a huge rejection rate at almost 60 percent.  Today, we note that rejection rate is at 1.8 percent. This is an indication that the prospects are quite promising,” he said.

He noted that in the past years the market was crowded by intermediariesand leaf handling was bad unlike this season where in all three auctions that have opened, leaf presentation as well as handling is good.

In a separate interview, a tobacco farmer, Madalene Salumba, could not hide her excitement saying the sales were satisfactory so far.

She said: “Most farmers seem to have been serious with their crop this year and as a result we have produced high quality leaf. This is evidenced by the less rejection rate and good prices that we have started fetching. We are only hoping that this continues.”

On his part, Paramount Chief Kawinga, who is board member of TCC and was guest of honour at the opening ceremony, advised farmers to take good care of their crop and ensure that it is in good shape before they bring the crop to the auction.

He said it is important that farmers desist from buying tobacco from random vendors who produce poor quality tobacco not fit for the market.

He said: “There are some unscrupulous farmers who either buy or bring poor quality tobacco but expect better prices and if they do not get what they want, they end up saying they are being riped off yet it is their product that is of poor quality.”

Two weeks into the marketing season, a total of $4.6 million has been raised from 3.7 million kgs of tobacco from Kanengo and Chinkhoma auction floors. 

Last year, a total of 194 million kgs of tobacco was sold at an average price of $1.42 per kg which raked in $275 million. This was a drop from $362 million from 168 million kg of tobacco that was realised in 2015.