Earnings from tobacco, Malawi’s main cash crop, has hit $11.1 million in the first five weeks of sales, figures from AHL Group have shown.
According to a report for Friday May 6 2022, the country has sold 5,689,196 kilogrammes (kg) of all types of tobacco at an average price of $1.95 per kg.
The earnings, however, represent a 78 percent drop when compared to the $50.6 million the country realised in the first five weeks of sales last year.
The volumes have also declined by 81 percent when compared to 30,316,603kg of all types of tobacco sold during the same time last year at an average price of $1.67 per kg.
This year, the market opened earlier on March 31 compared to last season, when the market opened on April 20.
This saw reduced volumes reaching the market and staggered to three days of sales in a week as compared to five last year.
Tobacco Commission Chief Executive Officer Joseph Chidanti Malunga said it was unfair to compare the figures when market operations are different.
“We just opened Mzuzu market which, at five weeks last year, was steadily operating. What we should be comparing are the prices being offered.
“There is more competition on the market this year than last year because the buyers know that there is limited supply due to low production,” Malunga said.
In a separate interview, Tobacco Association of Malawi Trust President Abiel Kalima Banda lamented low prices some leaf was fetching.
“There are some buyers who are stuck at offering the minimum prices but we have argued and will continue to argue that the minimum price is way below the cost of production and, therefore, we need the prices to keep rising.
“We expect things to improve because we started on a low and markets were opening on selected dates but now, for example, the Lilongwe market is running daily as required,” Banda said.
Tobacco remains Malawi’s main foreign exchange earner despite continued decline in production and earnings from the crop.
Last year, the country produced a total of 123 million kg of the green gold however due to a 20 percent anticipated decline in production; Malawi could produce about 98.4 million kg, a record low in the past 10 years.