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High production cost worries leaf growers

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Tobacco growers umbrella body, Tobacco Farmers Association of Malawi (Tama) Trust, has lamented elevated cost of farm inputs this season which it says could deter most farmers from producing the leaf.

Prices of farm inputs, especially fertiliser, have been rocketing at the back of dwindled supply due to the war between Russia and Ukraine, which started in February.

Tama Trust President Abiel Kalima Banda said most farmers are still willing to produce the green gold this season but there is a need for government intervention to cushion them from the high cost of production.

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Banda proposed the setting up of a bridging finance facility to assist the farmers.

“We are not very worried about prices because we believe that the prices will factor in the production cost but we are worried about the production cost itself because everything has gone up,” he said.

Fertiliser prices have been rocketing in Malawi and have risen by over 100 percent within a year.

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On June 6 this year, Tobacco Commission (TC) started grower registration which is expected to conclude on Friday.

TC has since said farmers’ response and turn-up for registration has been overwhelming.

TC spokesperson Telephorous Chigwenembe, could, however, not give details on the number of farmers who have registered to produce the leaf this season.

Chigwenembe then rated the Tama Trust’s concern as valid, especially among auction tobacco growers.

“Fears of cost of inputs have always been there but it is our hope that, through the companies that contract the growers, farmers will be able to get the inputs for them to grow tobacco,” he said.

During the 2021-22 farming season, the country failed to satisfy the international market demand of 140 million kilogrammes (kg) of all types of tobacco as it produced only 95 million kg.

The season was characterised by many challenges due to delayed rains and tropical storms which swept farms and have led to reduced output of the leaf.

The reduced output was, however, a blessing in disguise as prices of the leaf were higher than the preceding year

According to figures from AHL Group, as at close of the season, the green gold had raked in $141.5 million at an average price of $2.09 per kg, 28 percent higher than an average price of $1.63 registered last year.

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