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AHL says this year’s tobacco market fair

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BY WILLIAM KUMWEMBE

Tobacco market operator, AHL Group, has rated as fair this year’s tobacco marketing season while expressing optimism for continued smooth trading up to the end of the sales.

This comes at a time when the market has not registered any stoppages or suspension of sales in the first weeks of trading.

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Speaking during a mid-market assessment tour at Kabwafu Satellite Depot in Mzimba District on Tuesday, AHL Group Communications Manager, Thom Khanje, said the outlook in the remaining weeks of trading is positive.

Currently, the country has realised over $182.9 million from the green gold, a 26.7 percent jump when compared to the same period last year.

During the first 11 weeks of trading last year, the country’s top export crop had raked in $144.4 million.

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Figures from tobacco regulatory body, Tobacco Control Commission (TCC), indicate that, as at Friday last week, sales volumes for all types of tobacco stood at 107.2 million kilogrammes (kg) compared to 74.8 million kg sold during the same time last year, representing a 43.4 percent rise.

However, average prices remain relatively weak this year at $1.71 per kg, which is 11.71 percent shy of $1.93 per kg that the leaf was fetching during the same period last year.

In an interview, Khanje said there is hope that the prices will improve further going ahead.

“When we look at the broader picture, it has been a fair season. Going forward, there would be continued stability on the market,” Khanje said, adding that there has also been a drastic drop in the rejection rate this year.

Tobacco farmers are estimated to have produced 149 million kg of all types of tobacco this year, against the 171 million kg international market demand.

Stakeholders are currently conducting the third and final tobacco estimate, whose results would determine the closing day of the season.

Khanje said they anticipate that there will not be significant change in the production estimates.

“We are ready to run the market to the end with any amount of tobacco that would remain.

We will make sure that all the tobacco that is expected to be sold is sold so that the farmer benefits and the economy also realises enough revenue,” he said.

In a separate interview, Mzuzu Auction Floors Manager, Happy Chifungwe, expressed upbeat for continued smooth flow of the market going forward, saying there is still competition among buyers for the leaf.

He said there has also been a relative stability in the tobacco rejection rate and a substantial drop in level of market disruption, which gives confidence to all stakeholders.

One of the farmers at Mzuzu Auction Floors, Alex Chibaka, said the market trends have significantly improved this year, singling out improvement by AHL in payments to farmers after sales.

All things being equal, Malawi could earn slightly over $252.9 million from tobacco this year, compared to about $212 million earned last year

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