Key Business Points
- The preliminary demand for tobacco from buyers in the 2025/26 selling season stands at 170 million kilogrammes, a 25 percent drop from last year’s 213 million kg, which may lead to lower prices if more buyers do not join the market.
- The number of buying companies is projected to drop from 11 last season to eight this year, potentially reducing competition and dampening prices for tobacco farmers.
- The Tobacco Commission has licensed 242.5 million kg of tobacco, 42.6 percent higher than the current preliminary demand, highlighting the need for effective production control to avoid overproduction and price volatility.
The tobacco industry in Malawi is facing a challenging season ahead, with a significant drop in demand from buyers and a potential reduction in the number of buying companies. The preliminary demand for the 2025/26 selling season stands at 170 million kilogrammes, a 25 percent decrease from last year’s 213 million kg. This decline in demand, coupled with a decrease in the number of buying companies from 11 to eight, has raised concerns among analysts that prices may fall, leading to zovi za chuma (tough times) for tobacco farmers.
The Tobacco Commission has licensed 242.5 million kg of tobacco, which is 42.6 percent higher than the current preliminary demand. This has raised concerns about the potential for overproduction, which could lead to kugawa (smuggling) and kutengera (price manipulation). Agricultural extension services expert Leonard Chimwaza noted that weaker prices could result in increasing cases of smuggling, emphasizing the need for more buyers to join the market to strengthen competition.
Tama Farmers Trust president Abiel Kalima Banda suggested that the licensing process could be used to control production and supply, avoiding issues of overproduction that prolong the market. He emphasized the importance of kufikiria pano (thinking ahead) to avoid the problems that occurred last year, when the season was prolonged until October.
The Tobacco Commission has not yet conducted a production estimates survey, despite licensing 242.5 million kg of tobacco. Past trends show that output has remained below demand since 2020, highlighting the need for kupanga zinthu (planning) and kufikiria masiku anayamba (thinking about the future) to ensure a stable and profitable tobacco industry in Malawi. As the season progresses, it is essential for stakeholders to kukhazikitsa (be vigilant) and work together to address the challenges facing the industry and ensure a successful harvest.
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