Mining & Trade News

Despite ongoing efforts by the government to diversify into other potential sectors such as mining and tourism as major sources of foreign exchange, the Tobacco Commission (TC) says the future of tobacco, which is Malawi’s green gold, is still bright.
The Commission says there is lack of understanding on the performance of the industry by members of community who think the industry is dying.
TC’s CEO Dr. Joseph Chidanti Malunga told Agribusiness Review in an interview that there is need for a massive awareness campaign to deal with negative public perceptions about Malawi’s tobacco industry specifically on the issues of utilization of child labour and the world wide anti-smoking lobbying.
“There are a lot of things that people do not understand, that is including those who do research in this country because they just look at the tobacco industry without understanding to what extent these issues are affecting it ,” he said.
Malunga clarified that the anti-smoking lobby is not a major problem for Malawi’s tobacco industry as the existing buyers are still there, and more buyers are also entering the industry.
He said Malawi is also successfully fighting child labour in the industry with the country’s tobacco industry demanding child labor and abuse free strategies by farmers.
“The issue that is rocking the tobacco industry now is not anti-smoking lobby as being propagated but the issue is that everyone wants to produce tobacco without violation of human rights,” said Malunga adding currently the TC is working towards establishment of laws that will protect the farmer, buyer and laborer.
The bill that is under formulation is slated to incorporate the respect of human rights, provision of safe water and first aid medical facilities and other essentials right in tobacco farms.
Malunga said when the new legislation is operationalized, TC officials will be authorized to be inspecting the farms to ensure that no child labor is involved, the working environment is safe, and availability of other essentials for successful farming activities.
He said operationalization of such a law will boost the industry as well as bring back the glory it used to have in the past.
“In a nutshell, we want to eliminate all forms of human rights abuse in the tobacco industry,” he said.
Malunga also said there is growing negative perception towards the tobacco market prices with stakeholders speculating that the prices offered at the market are very low.
He, therefore, advised stakeholders to make a thorough analysis of the how the prices are trending by comparing the prices with the farmers’ inputs.
“When talking about the prices, let us all be looking at what the farmer is putting into his or her farming,” he said.
He explained that the input in terms of money and human resource plus quality of the output and the Malawi Kwacha exchange rate determines the deserving market price between the buyer and the seller.
But an agricultural expert Tamani Nkhono suggests that the country needs to go back to how the people used to do tobacco farming in 1980s, as some measures that were restructured were very fundamental.
Nkhono also advised authorities to accept the fact that the tobacco industry is dying in the country and find alternatives while pressing for the sustainability of the industry.
“We need to accept that the industry does not have a bright future in the country because if you look at the current trends, there is a reduction by at least 1% in the smoking rate due to the anti-smoking lobby,” he said.
He said this has affected sales of Malawi’s main tobacco variety, Burley, which is used for cigarette production as the framework convention on the anti-smoking lobby is targeting additives in cigarettes.
Nkhono also advised authorities to take a close look at the quality of the leaf that the country produces and sells to foreign buyers in comparison with the quality produced in other countries.
He said if the country improves on quality of the leaf, it will be attracting more buyers thus beating competition from other producing countries.
“Malawi has to try as much as possible to maintain or increase its market share by coming up with other interventions. We need to protect the economy by controlling who is supposed to be growing the crop and the quality. Not like it is the case now when there is chaos in the industry,” he said.
Malawi has a long history of tobacco production tracing it from 1920s. Currently, the country is among 10 leading producers of tobacco.
However, the World Health Organization (WHO) targets the smoking rate to drop by almost 50% as of 2030 as a result of its anti-smoking lobby.
Statistics from WHO indicates that 18% of the total world population for men and 1% of the total world’s total population for women smoke tobacco.
Meanwhile, Malawi’s 2021 tobacco marketing season has ended with a rise in total tobacco sales and money the country has realized, as compared to that of last year.
Statistics from Auction Holdings Limited (AHL) indicates that a total of 123.7 million kilograms of all tobacco types were sold, from which the country realised US$197.1 million.
AHL’s Spokesperson Teresa Ndanga described the marketing season as a success by also looking at the average price that has risen compared to that of last year.
The statistics indicate that this year’s average price is at $1.59/kg thus higher than that of last year which was at $1.53/kg.
“Increased volume of traded tobacco and better average prices in the 2021 tobacco marketing season had a positive impact on the earnings compared to the revenue realized in 2020,” said Ndanga.
Among the major types of tobacco, farmers have sold 104,218,047 kilograms of Burley with a total of US$155,346,149.25 realized.
The country has also sold a total of 16,758,185 kilograms of Flue Cured tobacco and has generated a total of US$37,382,666.64 while on the other hand, some farmers brought a total of 2,678,109 kilograms of Dark Fired tobacco that has produced money amounting to US$ 4,321,361.76.
The average price for each tobacco type was at US$1.49/kg for Burley, US$2.23/kg for Flue Cured and US$ 1.61/kg for Dark Fired tobacco.
Ndanga said this year’s marketing season was a success also by considering the fact that the rejection rate dropped, the development which signifies that a lot of farmers sold their tobacco.
“The seasonal cumulative no-sale rejection on the auction burley market was lower at 11% this year, compared to 66% registered at the end of the season last year,” said Ndanga in a statement.

Leave a Comment

Comments