Malawi’s Tobacco Sector Generates K760bn in Sales: A Catalyst for Economic Growth
Key Business Points
- Tobacco earnings have reached $435 million (K762.3 billion) from 170 million kilogrammes, accounting for 98% of the projected 174 million kg, indicating a surge in production.
- The average price per kg has decreased to $2.55 (K4 465) compared to $2.98 (K5 217) last season, highlighting the challenges of low prices despite increased volumes.
- The Tobacco Commission (TC) has opened farmers’ registration for the next season, urging farmers to prepare and consider factors like hectarage and resources, especially fertiliser, to ensure a successful season.
Malawi’s tobacco industry has shown mixed results this season, with increased volumes but lower prices compared to last year. According to the Auction Holdings Limited (AHL) weekly report, the country has sold 170.8 million kg of tobacco at an average price of $2.55 (K4 465) per kg, surpassing last season’s 133 million kg. This development is a positive step towards achieving the goal of producing 200 million kg per year by 2030, as stated by the Tobacco Commission.
The increased volumes indicate that the country has produced more tobacco, with higher demand for the leaf. However, the low prices pose economic challenges, and the country still needs to sell more to meet the declared trade demand of 213 million kg. Tama Farmers Trust chief executive officer Nixon Lita described the season as mixed, with a relatively lower price but an improvement noted as upper leaf dominates the market.
Agriculture and economic experts have warned that the country’s continued dependence on tobacco for foreign exchange poses economic challenges. To address this, farmers are urged to start preparing for the next season by registering and considering their sekela (farming resources) and mbala (farm size). The TC has opened farmers’ registration for the next season, which will run for four months from 23 June 2025. Last season, Malawi earned $396 million (about K693 billion) after selling 133 million kg of tobacco at an average price of $2.98 (about K5 217) per kg.
As the season progresses, malonda (farmers) are advised to focus on kulima (farming) practices that can improve yields and quality, ultimately leading to better prices. The soko (market) is expected to continue progressing, with indications that the estimated tonnage might be achieved. With the right strategies and preparations, Malawi’s tobacco industry can overcome the current challenges and achieve tsoka (growth) and chikondi (prosperity) in the future.
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