Stakeholders in tobacco production and marketing have described the 2019/20 season as a mixed bag owing to reduced production of the crop that depressed increased prices that were offered on the market.
This comes as the crop’s selling season is coming to an end on Friday with closure of the last market, Mzuzu auction floors.
According to final tobacco estimates released by the Tobacco Commission (TC) recently production of the crop has declined to 113.3 million kilograms.
This represents a 31.6 percent decline in production when compared to the 165.6 million kilograms of tobacco sold during the 2018/19 season.
However, prices of the commodity improved on the market having registered an average price of $1.54 at the beginning of the final week of sales compared to an average price of $1.43 recorded at the end of the 2019 selling season.
In an interview TC Chief Executive Officer, Kaisi Sadala, said due to Covid-19 prevalence markets operated with restricted access to growers and reduced layout under auction system which affected the sales.
“The Commission introduced secret bidding under auction system which was slow than normal. The Covid-19 pandemic has challenged the industry to quickly adapt and explore new selling system like e-marketing which is ideal in such circumstances,” Sadala said.
He said the Commission is optimistic of a better season next year albeit recession pressures arising from Covid-19 effects on supply chains.
Tobacco Association of Malawi (Tama) Trust Chief Executive Officer, Nixon Lita, said the biggest challenge was high rejection rate on auction sales which went above 70 percent on some days.
“Having expectations of a 155 million kilograms production and ending up with 40 million kilograms less has been a let-down also. We had missed demand even at expected 155 million kilograms, but now reality is even a wider margin.
“We need to learn as to why we are failing to produce the demanded tonnage. Presentation of tobacco for sale, especially from auction market needs to improve. As a grower body we will be working with our partners in extension services to work on this short fall,” Lita said.
At the end of last week, the country had realised $172.2 million from the sale of 112.1 million kilograms of all types of tobacco.
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