9 February 2013

Zimbabwe: Tobacco Selling Season Expected to Be Shorter

THE 2013 tobacco selling season is expected to be shorter by 90 days because of the prepardeness of both farmers and auction floors. This year the season may be completed in  50 days if growers book their crop in advance, the Tobacco Industry and Marketing Board revealed after touring the floors yesterday.

Normally the season runs for 120 to 140 days depending with the capacity and deliveries to the auction floors.

TIMB said the Tobacco Sales Floor has the capacity to sell 15 000 bales a day, Boka Tobacco Floor, 12 000 and Premier Tobacco Floor 6 000 up from last season where it could only sell 3 000 bales a day. The 2013 tobacco selling season opens this Wednesday with the contract sales opening Thursday. All stakeholders in the industry have expressed confidence that the season is going to be a successful one considering the preparations auction floors have made.

Tobacco auction floors have indicated their readiness while on the other hand farmers have started delivering their crop to the floors.

By Friday afternoon, Northern Tobacco, a contractor, had received more than 11 000 bales while the auction floors had received more than 300 bales each. More tobacco was expected to come in over the weekend as all floors indicated that they will work 24 hours to enable farmers to deliver their crop. This season farmers are anxious to get good prices as this was the major challenge they faced last season. The highest price remained at US$4, 99 per kilogramme throughout the season while at the contract market prices increased to above US$5 per kilogramme.

Over the years, farmers had been complaining of shortages of hessian bags, congestion at floors, late payments, cash shortages and inadequate ablution facilities but the TIMB has since addressed these issues.

According to the TIMB, the issue of cash shortages will not resurface as buyers are only approved after proving that they have cash source outside the country. No buyer is allowed to source money locally. On the other hand banks have already confirmed that they have enough cash to pay farmers who would have sold their crop. Since 2012, all auction floors were required to provide accommodation, ablution facilities, clinics, clean water, decent canteens and this has since brought order in the industry. Growers sold their crop without hassles and the licensing of four auction floors eased congestion at floors.

This year, TIMB licensed three auction floors namely Premier Tobacco Auction Floor (PTF), Tobacco Sales Floor (TSF) and (BTF) Boka Tobacco Auction Floor.

Last season there were four auction floors including Millennium Tobacco Floor which could not be licensed this year as it failed to meet the requirements. At BTF, the company extended canteens to increase capacity and also introduced additional conveyor belts to dispatch tobacco much faster and reduce the dependence on labour. BTF director, Ms Rudo Boka said the floor has back-up generators, water supplies and eight banks.

"We have also accommodated inputs manufacturers to ensure farmers buy at affordable prices and reduce the middlemen who usually reap off farmers," she said.

PTF has a clinic manned by professionals additional water supplies, and now has facilities where farmers can dine while waiting for their money.

PTF managing director, Mr Philemon Mangena said this season the auction has a pool of transporters to assist farmers deliver their crop to the floor.

"We also contracted growers in Masvingo and Gokwe to grow 2 000 hectares of tobacco and we hope to keep expanding the programme to areas that have not been growing the crop countrywide," he said.

At TSF, the managing director, Mr James Mutambanesango said this season, there will be eight banks that have indicated that they have enough cash to pay farmers. He said there will be enough security from the ZRP and internal security officers.

"Farmers will also have decent accommodation and food from the canteens," he said.

Northern Tobacco was carrying out last touches to the toilets that were being renovated. The company has a queries office. Northern Region general, Mr Glen Young said they have an efficient transport system in place to ferry tobacco from farming areas to their floors.

TIMB chairperson, Mrs Monica Chinamasa said she was happy with the preparations for this year's tobacco selling season.

"After touring auction floors I can safely say the industry is fully geared. Everything is in place and we hope this is going to be a successful season where farmers will be happy," she said.

Mrs Chinamasa said growers were free to book and deliver on a first-come-first-serve basis to a floor of their choice. She said the practice of "deliver today and sell tomorrow" would apply at all auction floors.

Last year, TIMB licensed 15 Class A buyers and this year the number has increased to 18 with Aikles Investments Private Limited, Voedsel Entreprises and Dashville Enterprises coming on board for the first time.

There will also be 15 authorised contractors. Last season, a total of 144,5 million kilogrammes of flue cured tobacco was sold, with contract sales accounting for 63, 95 percent of the sales. Seasonal average price per kilogramme for flue cured tobacco was US$3,65 per kilogramme, an increase from the 2011 average price of US$2,73 per kilogramme. This saw growers pocketing a total of US$527 million compared to the US$361,4 million in the previous year, an increase of 46 percent earnings to growers.

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