Zimbabwe has so far earned US$557.11m from tobacco exports, reflecting a 21% surge from US$462.29m reported in the same period last year, latest Tobacco Industry Marketing Board (TIMB) report shows.
The country exported 122.92m kilogrammes (kg) of tobacco compared to 115.70m kgs in the prior comparative period.
The country exports its semi-processed tobacco to destinations including the Far East, the European Union, Africa, Middle East, Europe and the Americas, among many others.
The prices of the golden leaf on the international market, according to TIMB latest report, firmed to US$4.53 per kg in 2022 from US$4.00 per kg in 2021.
The Far East, especially China, is the top destination for local tobacco.
“As of Friday October 8, 2022, the country’s tobacco export receipts stood at US$557.1m from US$462.2m realised same period last year. The mass also improved to 122.92m kg from 115.70m kg in the same period last year with average prices also going up to US$4.53/kg from the US$4/ kg comparable period last year,” TIMB said.
Tobacco, which used to be the leading foreign currency earner for Zimbabwe, has gone down on the pecking order resulting in the golden leaf losing ground to gold, platinum and diaspora remittances.
It is estimated that over 90% of the tobacco farmers in Zimbabwe are under tobacco merchants’ contracts.
The merchants provide the farmers with inputs, since most farmers cannot raise their own capital required to undertake a tobacco farming business.
The prices of the inputs are sometimes inflated, as the merchants take advantage of the desperate tobacco farmers.
Under such contract agreements, the tobacco merchants deduct their dues-the principal amount plus interests- at the auction floors, a situation which has seen some tobacco farmers taking home negative balances as some debts are carried forward.
This situation has affected production resulting in most farmers mulling to dump the golden leaf for other cash crops
The development comes at a time the government has failed to avail the promised US$60m revolving fund to the tobacco industry.
The funding was supposed to be disbursed in August last year but is yet to take off.
This has left desperate tobacco farmers at the mercy of tobacco merchants.
According to TIMB, from every US$1 earned, US$0.85 is going to the merchants with farmers earning a pittance US$0.15, a situation which leaves most farmers poorer than they were.
Latest figures show that 208.27m kg were sold at US$636.97m.
The figure looks very attractive but a huge portion of that money went towards the repayment of loans with farmers struggling to make ends meet.
In 2021, Zimbabwe grossed US$819.7m after exporting 183.6m kg of tobacco.
“Sales to the Far East earned US$485.2m followed by the European Union whose sales raked in US$118.4 and Africa’s US$102.3m,” TIMB said.