AHL Group has said Malawi can earn back money it has lost through the diminishing tobacco sales if growers adopted a diversified approach to crop production.
While conceding that the anti-smoking lobby has affected tobacco sales this year, the group’s Mzuzu Auction Floors Manager, Joseph Kawinga, asked growers in Rumphi to grow legumes and grains along with tobacco if their earnings are to be maintained.
“Tobacco production will be around for a few more years but it is high time farmers started diversifying.
“Legumes have the potential of producing earnings equivalent to those the country is losing through the diminishing proceeds from tobacco on the market,” Kawinga said.
The demand for Malawi’s major foreign exchange earner, tobacco, is becoming leaner by each passing year following revelations that buyers are looking for only 120 million kilogrammes in the next growing season.
Last year, the buyers required farmers to produce approximately 135 million kilogrammes. However, farmers overproduced by over 30 million kilogrammes, a development which Kawinga said is behind reduced average prices for the leaf.
He said AHL has been forced to keep the marketing season open for another week as it negotiates with buyers to take up the excess leaf from the last growing season.
“We were supposed to close the season last week but we are trying to talk to buyers to take up the remaining tobacco,” Kawinga said.
On average, Kawinga said the 2014/15 tobacco selling season averaged $1.75 while this year, the standard price is stuck at $1.48.
He cautioned farmers and other players in the industry that if the trend continued in the 2016/17 growing season, the average price is likely to hit slender margins next year.
Kawinga assured the growers that there is an already existing demand for such crops if they sell through AHL Commodities Exchange (AHCX), the AHL subsidiary which markets agriculture produce.
AHCX facilitates trades in maize, soya beans, groundnuts, sugar beans, sunflower and pigeon peas.
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