The 2026 tobacco marketing season continues to perform dismally, characterised by high rejection rates, low prices offered by buyers and a shrink in revenue compared to last year.
The situation has triggered concerns over the country’s foreign exchange outlook and the welfare of thousands of farmers who depend on the crop.
Figures from Auction Holdings Limited show that, by the end of week five, the country had sold a cumulative 29.01 million kilogrammes (kg) of tobacco at an average price of $2.10 per kg, generating $61.02 million (K106.8 billion) in revenue.
This represents a sharp decline from the corresponding period last year when Malawi had sold 56.06 million kg at an average price of $2.42 per kg, raising $135.73 million (K269.1 billion).
The latest figures mean tobacco earnings have dropped by $74.71 million (over K130 billion) compared to the corresponding period in 2025 while volumes sold have fallen by almost half.
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Both tobacco volumes sold and revenue earned have declined this year by about 48.3 percent and 55 percent, respectively, compared to last season.
The average price has also declined by about 32 cents per kg, a development analysts say could further squeeze farmer incomes amid rising production costs.
Production estimates for the 2026 season stand at 197 million kg against an estimated demand of 170 million kg, leaving an excess supply of 27 million kg, which has also impacted market performance.
The market is also operating with fewer buying companies this season, with eight buyers participating compared to 10 during the previous season, and even a few numbers of buyers actively participating on the market.
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Economist Marvin Banda cautioned that continued underperformance in the sector could place the country in a “precarious situation” when it comes to stabilising and defending the official exchange rate.
“The over-reliance on tobacco inflows has exposed the economy to a point where it is time to rethink, strategically, the implications of overreliance on the market when it comes to forex inflows,” Banda said.
In an earlier interview, Tobacco Farmers Trust President Abiel Kalima Banda lamented the poor performance of the market.
Kalima Banda also expressed optimism that despite the poor opening, it may still be too early to make definitive conclusions about the entire season as better quality leaf may be yet to reach the auction floors later in the season.
Last year, Malawi sold 221 million kg of tobacco and earned about $542 million, with the season closing at an average price of $2.45 per kg.
