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Tobacco rakes in $50.6 million

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Teresa Ndanga

Malawi has realised $50.6 million from tobacco in the first five weeks of sales, figures from market operator, AHL Group, show.

The revenue is about $11.2 million higher than the $39.4 million earned during the same time last year.

AHL Group attributes the rise in revenue to quality leaf farmers are bringing to the market which is attracting better prices than last year.

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By this time in 2020, average price per kilogramme (kg) was seen at $1.53 compared to $1.67 per kg the leaf is fetching now.

In an interview, AHL spokesperson Teresa Ndanga said, at the beginning of the season, the market was marred by high rejection rates which hit 92 percent.

However, the rate has dropped to 47 percent.

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“The average rejection rate I have mentioned is across the board, both auction and contract, but of course, in comparison, on the auction market it is relatively higher.

“That is because we see some challenges in case of storage and grading of tobacco. They are more prominent on the market,” Ndanga said.

She singled out poorly grading and mouldy leaf brought to the market by some farmers among contributing factors to the high rejection rate.

But some farmers at the Lilongwe Auction Floors lamented low prices buyers are offering for the leaf.

“I do not see myself being able to pay my workers or buying a motorcycle from this year’s sales,” said Bazwell Sikenala, one of the tobacco growers.

He said he expected his bales to be sold at as high as $2 per kg but could fetch as low as $0.90 per kg.

Similar sentiments were made by Evance Moyo, who said he laboured to produce a quality leaf only to be frustrated by low prices.

So far, 30.3 million kg of all types of tobacco have been sold compared to 25.8 million kg sold during same period last year.

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