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Diaspora Matters

SHOULD TOBACCO FARMERS BOYCOTT SELLING TOBACCO?

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The Tobacco selling season started on the 20th of March with a lot of high expectations. However, this was not to be as there has been a lot of grumbling and gnashing of teeth when it comes to the pricing. The auction floors namely TSF,Boka and Premier tobacco are usually a hive of activity this time of the year but this year it’s a different story. The average selling price has ranged between 1.20 – 1.70 Dollars, perhaps I need to specify here that the prices are in United States Dollars and not ZWL at the time of selling. The other day whilst I was at TSF auction floor I got to talk to a farmer Mr Kainama from Karoi who was fuming with anger as 5 of his 7 bales had been rejected. The ones that had been bought had been bought at 0.20 and 1.98 USD each. After listening to the farmer narrating his story, I was then prompted to write this article with the hope that other farmers could benefit as well.

Let me first start by mentioning that opinions expressed here are my individual opinions and should not be misconstrued as otherwise. After having a lengthy chat with Mr Kainama, I then found out that the tobacco he had brought was from last year. The farmer had decided to hold on to his tobacco at the end o the 2018 selling season as he felt that the prices were too low. It is an open secret that most merchants towards the end of the season would have met their required kilograms of tobacco hence demand will be low, so the prices take a nose dive too. Anyway, back to our farmer. Mr Kainama went on to explain that he put his tobacco into storage until this current selling season. He also realised that some insects had invaded his tobacco whilst in storage and he had tried to sun dry as pick the insects. It is very important to know that the guys buying tobacco at the auction floors are adequately trained and have a very good eye for such irregularities. This was an automatic reason for the rejection of this farmers bales.

Most farmers are encouraging each other to hold back their tobacco from the auction floors with the hope that the current prices will change. Naturally as the season progresses the prices are set to improve slightly as more buyers come forth. This has been the trend in previous seasons, but we don’t know how this season is going to be like.

Most farmers especially communal farmers do not consider the risks associated with long term storage of tobacco. Firstly, it is important to note that long term storage of tobacco requires a permit from TIMB. Secondly and most importantly before you consider storing your tobacco for extended periods which is not advised you need to invest in pest control. The tobacco beetle and tobacco moth the most devasting pests in tobacco storage can destroy your tobacco significantly. It is important to also note that once these pests are found in your tobacco at the auction floor TIMB is notified immediately. TIMB may go to the extent of blocking your growers’ number effectively banning the farmer from selling. The farmer will then be required to get a certifying letter from a registered fumigating agent that indeed they have fumigated which is costly. Mould is another huge risk, it will occur when tobacco is stored for extended periods in conditions with 15 % humidity and above.

It is quite important for the farmer to take into consideration all these points and take the necessary precautions. However, for 90% of the farmers who can not afford proper storage facilities which have been fumigated, which also have pest traps etc it may be better to send your tobacco to auction. I know some are probably reading this and are saying “Hatidi kunohodesa fodya”, loosely translated to we don’t want to go and give away our tobacco. However, It is important to look at this issue from a business perspective, in my opinion you stand to loose more by keeping your tobacco in storage especially if you know that you don’t have proper storage facilities.as the loses may be 100%. Consider this before you decide to hold back your tobacco think of the possible consequences. Lastly farmers are urged to avoid doing business nemaGweja, (middleman), good tobacco sells yega. Food for thought.

Emmanuel D.N Dube  (ZIBN Agriculture correspondent)

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Ntate Victor

The author Ntate Victor

Ntate Victor is a Chartered Management Accountant, ACMA, CGMA and an award winning business coach and consultant. Author of 6 books and skilled in financial analysis, strategic planning, risk management, and business coaching. Contact +263 773 055 063