LIVINGSTONE MARUFU
A number of tobacco companies are expecting the tobacco marketing season to intensify after two weeks due to the late rains that affected production.
Dry land tobacco farmers who usually plant late November, this summer cropping season planted in January, giving an indication that the crop was heavily affected with the dry spell and climate change effects.
The 2022 tobacco marketing season opened yesterday.
“Despite the season having opened on Wednesday [yesterday], we expect the low volumes during this week with increased volumes expected in the next two weeks due to the late rains and prolonged dry spell which affect the growth of the crop,” Agritrade Leaf Tobacco chief executive officer Cephas Rukweza told Business Times.
He said the contracted farmers are yet to book for this season despite being prepared for the season.
This year the tobacco farmers’ registrations fell 17% to 119 979 this year from 140 771 last year while the new farmers registrations plunged 224% to 529 from 1717.
The Tobacco Industry and Marketing Board (TIMB) CEO Meanwell Gudu said the dry land crop will come late due to the late onset of the season.
“Generally the rainfall season was late with effective planting rains received around end-November to mid-December 2021 hence it is likely to be delivered a bit late,” he said.
Gudu said the irrigated crop is medium to heavy bodied, predominantly lemon in colour and reflecting a fair to good quality.
The main dryland crop is medium bodied in the commercial sector whilst being light to medium bodied in the smallholder sector.
According to the TIMB boss, the late dryland crop has poor stand due to prolonged dry spell which was experienced post planting time towards end of December and will be delivered late.
He said the top quality tobacco grades for premium brands are likely to remain unchanged at US$3,50 and US$5,40/kg in prices despite the late planting.
The high-end market for this grade has reached its ceiling in price increase.
The major market for these grades is in China and there are no indications to change prices upwards.
Brazil has an almost similar flavour to Zimbabwe but faces challenges, inconsistency in the supply of orders and some changes in flavour due to sometimes natural disasters like floods.
However, Brazil tobacco is generally cheaper than Zimbabwe attributable to low production costs.
This season, there will be more pressure on the demand side to take the crop, which should naturally increase prices upwards due to anticipated reduced volumes in Zimbabwe.
This is likely to be experienced in the medium to filler grades.
“Some kind of hoarding of tobacco is likely to happen that may influence prices to be better because of disruptions in logistics caused by Covid-19,” Gudu said.
Supply chains were disrupted from 2020 into 2021 due to shortage of vessels and closure of some shipping lines.
Now that the world has lifted the Covid-19 restrictions and uncertainty in the possibilities of other waves, customers are likely going to grab this opportunity to stock up their tobacco, thereby increasing artificial demand.
