Ministry of Agriculture, Irrigation and Water Development and Tobacco Control Commission (TCC) have expressed worry over some tobacco buyers who are purchasing the leaf at a minimum price towards the end of the market season.
As of Wednesday, for example, at Mzuzu Auction Floors, the leaf was being bought at an average of $1.89 per kilogramme (kg) price.
Minister responsible, Joseph Mwanamvekha, conceded that there are a number of issues that have to be addressed in the next season.
“Most of the buyers are only paying the minimum prices and the minimum prices are varying from buyer to buyer. There is also a big deference between contract farming and the auction tobacco.
“These are the issues that need to be addressed. We will sit down with AHL [Auction Holdings Limited] and TCC and buyers and growers. But overall, we had a better season than last year,” Mwanamvekha said.
TCC Chief Executive Officer David Luka concurred with the minister, adding that was not the case the time the season was starting.
“We are concerned. The minimum prices are a starting point. At the first, the buyers were buying at good price, but it seems they have forgotten that.
“To pay a minimum price does not mean that they are breaking the law but we just want them to go a bit higher. Had it been they were constant in their rates, the amount realised would have been much higher,” he said.
He, then, encouraged farmers to grow the crop more next year, adding government will find market for it.
Luka, on the other hand, reiterated on the need for farmers growing the leaf in the forthcoming growing season to observe quota so as to minimise cases of high rejection rate as it was the case last year.
The ongoing tobacco market season, which is scheduled to close on August 4, has raked in $200.05 million as of Wednesday.
During the same period last year, the leaf had realised $162 million, representing 32 percent increment.
Despite low tobacco production this year, the country has sold 106 million kg of the green gold, compared to 103 million kg sold during the same period last year.
Limbe and Chinkhoma auction floors concluded their seasons on July 21 while their Lilongwe and Mzuzu counterparts will close on July 28 and August 4 respectively.
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