Earnings from Malawi’s main forex earner, tobacco, reached $193.8 million in 10 weeks of sales, figures from the market operator, AHL Tobacco Sales Limited, and industry regulator, Tobacco Commission (TC), show.
The earnings represent a record 190 percent jump from $66.9 million earned during a similar period last year.
The figures further indicate that the country has so far sold 84.2 million kilogrammes (kg) of all types of tobacco at an average price of $2.30 per kg.
The volume and average price have also risen by 161 percent and 11 percent, respectively, when compared to 32.3 million kg sold at an average price of $2.07 per kg during the same time last year.
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In the week running to Friday, there was no tobacco which was rejected.
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Meanwhile, Tobacco Association of Malawi (Tama) Trust is mobilising farmers who diverted to producing other crops to return to tobacco growing next season.
In an interview, Tama Trust President Abiel Kalima Banda lamented glaring mismatches between supply and international market demand, saying the country’s farmers have capacity.
“We encourage all tobacco farmers to register and produce the crop next season so that we are able to meet the demand.
“The market has been exciting this year, with high prices, very minimal levels of rejection and fast sales, and this should entice all that were frustrated by prices before to get back to tobacco production next season,” Banda said.
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TC spokesperson Telephorus Chigwenembe said the commission projects annual tobacco output to grow to 200 million kg by 2028.
“Increasing our annual production is what we are striving for. Currently, we are failing to meet the trade demand, which this year is at 170 million kg, against production, estimated at 126 million kg,” Chigwenembe said.
He said a third round crop survey to determine final production estimates is underway.
Chigwenembe said the one-week exercise is aimed at establishing tobacco volumes that are yet to be taken to selling floors.
“The results, expected after June 28, will give the actual tobacco production for the year and will help the industry plan the closure of the 2023 tobacco selling season,” Chigwenembe said.
Tobacco remains Malawi’s top export crop and main foreign exchange earner.
But the country continues to grapple with acute forex shortage which affected almost all other sectors of the economy.
There has been glaring mismatches between forex supply and demand as the country’s imports bill stands at $3 billion compared to an export value of about $1 billion per annum.
Figures from the Reserve Bank of Malawi indicate that, during the first quarter of 2023, for example, merchandise trade deficit widened to $283.5 million from a deficit of $15.7 million during the preceding quarter.
But in its recent Monetary Policy Report, the central bank expressed optimism for a possible ease in the pressure as the tobacco selling season gets to its peak.
