Malawi has so far realised a total of $166.7 million from sales of top export crop, tobacco, a 33.6 percent jump when compared to same period last year, thanks to increased volumes traded, figures from regulator, the Tobacco Control Commission (TCC), have shown.
During the first 10 weeks of trading last year, the green gold had raked in $124.7 million.
The figures indicate that as at Friday last week, sales volumes for all types of tobacco stood at 98,596,916 kilogrammes (kg) compared to 65,148,859 kgs sold during the same time last year, representing a 51.34 percent rise.
The traded volume is 66.7 percent of the 149 million kg estimated to have been produced by farmers this year.
However, average price remains relatively weak this year at $1.69 per kg, which is 11.17 percent shy of the $1.91 per kg that the leaf was fetching during the same time last year.
All things being equal, at the rate tobacco sales are going, Malawi could earn slightly over $252.9 million this year, compared to about $212 million earned last year.
TCC Chief Executive Officer, Kaisi Sadala, said there is hope that the prices would improve further going ahead, as farmers are have started bringing top quality leaf to the auction floors.
Improvement in the prices could mean a further rise in earning, according to Sadala.
“Due to higher volumes, we are using a higher denominator in calculating the average price compared to the case in the previous year. The other reason is that we have just started pushing in the high value styles now.
“If the prices were not good, growers would be holding on to the crop, waiting for the prices to improve,” Sadala said.
Commenting on the overall market performance, Sadala said TCC is satisfied with the revenue earned this far which points to a possible rise compared to the case last season.
He said final production figures would be known after the third and final crop estimate exercise which starts on Monday, June 25.
In an interview, Dean of Social Sciences at the Catholic University, Gilbert Kachamba, said the earnings projection still portray that the leaf continues to lose its charm.
He said Malawi should now encourage diversification of foreign exchange earnings, adding that though tobacco brings in more foreign exchange, the extent at which the cash crop has played a part in foreign reserves has been minimal of late.
With Malawi needing a total of $210 million for her imports every month, the earnings from 67 percent of the green gold could be enough to run the economy for 23.8 days.
Former Economics Association of Malawi (Ecama) president, Henry Kachaje, last year said tobacco stopped being the country’s top foreign earner a long time ago.
He said Malawi is relying on international organisations which are pumping a lot of dollars into the economy as the top forex earner.
“But the question we need to ask ourselves is that is this sustainable? We need to find a sustainable commercial means of getting forex,” Kachaje said.