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.
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“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.
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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.
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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.
