Tobacco prices and earnings remained on an upward trajectory last week, reaching an average price of $2.81 per kilogramme (kg) and $182 million, respectively.
In a weekly tobacco sales update, market operator, AHL Tobacco Sales Limited, attributes the performance to increased dominance of high-quality bolded leaf styles on the market, registering a price increase of 10.8 percent when compared to the $2.78 per kg recorded in week 6.
The earnings have increased by $38.1 million from $143.9 million recorded in the preceding week.
“At the close of business on Friday 31 May 2024, a total of 64.7 million kilograms of all tobacco types had been sold; depicting a 286 percent increase in sales volume after seven weeks of sales this year, compared to 50.3 million kilograms of all tobacco types traded during the same comparative period last year.
“By the end of week 7, the seasonal average price stood at $2.81 per kg, a marked increase of 26 percent this year, compared to $2.23 per kg recorded during the same period last year,” reads the update.
It says that to date, it has earned $182 million this year; representing 62 percent in sales revenue, compared to $112.1 million realised during a similar period last year.
In an interview, Tobacco Association of Malawi Trust President Abiel Kalima Banda said the season marks a turnaround in the tobacco industry as it is headed for greatness.
“With the increase in prices be assured that next year we are going to have a lot of farmers joining the industry and I am confident that we will be able to produce more than the 200 million kg 2026 target.
“These prices are a result of combined factors of good graded tobacco and competition among buyers and we are confident we will see this trend continue to the end of the market,” Banda said.
He added that there has been an improvement in payment for tobacco sales which was a problem in the early weeks of the marketing season.
