2019 tobacco season ends – The Times Group Malawi

Post was last updated: September 30, 2019

The 2019 tobacco selling season ended on Friday following the closure of Lilongwe and Mzuzu Auction floors.

It was, however, not clear, how much the country has realised from the sales as the authorities were still computing figures.

However, as at September 25 the country had realised $234 million from 163 million kilogrammes (kgs) of the green gold.

Among others, the season was characterised by low prices and high rejection rates due to prevalence of thin styles following the prolonged rains during the 2019 season.

AHL Group Public Relations Manager, Tereza Ndanga, described this year’s tobacco selling season as a mixed bag.

“The season was generally with very few stoppages. This was also partly due to AHL Tobacco Sales establishment of receiving centres in rural areas where farmers were able to deliver their bales and we would transport them to the respective floors. It was fast and safe.

“Small scale farmers were also happy that those who had licensed less than 1,200 kilograms of tobacco were exempted from withholding tax and AHL Tobacco Sales duly ensured that this was implemented as directed by President Peter Mutharika when he opened the season alongside his Tanzanian counterpart John Pombe Magufuli,” Ndanga said.

She added that during the marketing season, AHL introduced a mobile based platform called AHL252 through which farmers accessed all information on tobacco sales while in the comfort of their homes.

Ndanga admitted that this year’s prices were generally low, though there was a slight pickup towards the end of the season.

“Prices throughout the weeks preceding the few final ones were generally low because of the high estimated production volumes of 206 million kgs at the beginning of the 2019 season. The low of supply and demand was quite evident.

“The prices, however, picked up towards the end of the marketing season, the highest being 230 cents per kg after it was realised that the actual volumes would be far below the estimated volumes. As of Thursday, September 26, only 163 million kgs had been sold. Last year, 202 million kgs were sold,” Ndanga said.

This year’s season also saw some uncertainty regarding how the anticipated excess volume could be disposed of following enactment of the new tobacco law.

Some growers interviewed at the Lilongwe Auction Floors on Friday described the just-ended tobacco season as traumatising.

One of the growers, Musa Selemani, said most of the green gold was bought at prices below cost of production.

“This frustrated growers as they failed to break even,” Selemani said.

Meanwhile, AHL says it expects to release final sales figures today.

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