LIVINGSTONE MARUFU AND TANATSWA KANDENGA
Vice President Constantino Chiwenga has challenged the companies involved in the tobacco value chain to begin value addition processes this year in order to preserve jobs.
Zimbabwe is only getting US$1bn in export receipts from its over 200m kilogrammes of tobacco yet the same tobacco fetches US$15bn on the international market after the value chain.
Speaking to the delegates yesterday at the Tobacco Sales Floor to kick off the 2024 tobacco marketing season, Chiwenga said that the nation cannot afford to lose any more revenue or employment to profit-seeking foreign companies.
“I was talking to the Tobacco Industry and Marketing Board [TIMB] chairman Patrick Devenish and the Lands, Agriculture, Fisheries, Water and Rural Development minister, Dr Anxious Masuka, and said that we have exported enough of our raw leaf. We need to beneficiate and it is you that must come up with a value chain plan. We must not end only in growing tobacco but we must go further to beneficiate this important crop that we grow here in Zimbabwe. Together we can do it,” VP Chiwenga said.
He said the government is concerned that 98% of the tobacco is exported in raw form.
Alongside the push for beneficiation and value addition, the government has established a comprehensive plan in the Tobacco Value Chain.
“Government regards the tobacco industry as a sector that has great potential to grow and increase our country’s foreign exports earnings. This realisation led to the launch of the Tobacco value Chain Transformation Plan,” VP Chiwenga said.
He added that the aim of the tobacco value chain transformation is to transform the tobacco value chain into US$5bn industry by next year 2025.
“The thrust of the Tobacco Value Chain Transformation Plan is to transform the tobacco value chain into US$5bn industries by 2025. This will be achieved through increased production and productivity, increasing local production to 300m kg annually, localisation of tobacco production financing, value addition and beneficiation as well as exports of cigarettes”, Chiwenga said.
According to VP Chiwenga, the government through the Ministry of Finance, Economic Development and Investment Promotion remains committed to capacitate tobacco farmers by localising finance for 150 000 producers.
He said furthermore, in a bid to mitigate the increased cost of production, the foreign currency retention for tobacco growers for 2023/24 tobacco-marketing season was standardised at 75% in line with the retention level for other market players and this means the 25% will be paid to tobacco growers in local currency.
The tobacco industry is still grappling with the challenge of growers who continue to cut down indigenous trees for curing tobacco despite TIMB’s efforts of restoring order and sanity in the industry.
“The cutting down of indigenous trees is attracting a lot of negative attention from the global market, with some threatening to stop partnering with us. Therefore, I encourage all growers to establish 0.3 ha of fast-growing trees for every ha of tobacco planted. We are also undertaking research on other cleaner curing fuels. Accordingly, TIMB has partnered with Kutsaga and Gas Cure (a gas technology company) to do trials on the use of LPG and Biogas in curing tobacco. The trials are progressing very well,” TIMB board chairman, Patrick Devenish said.
The first bale weighed 120 kg and was sold at US$ 4.92 per kg against 113 kg bale which was sold for US$4.35 per kg last tobacco marketing season.
