HARARE – The 2021 tobacco season is booming, and outpacing the prior season’s underwhelming performance in both sales volume and value terms.
According to data provided by the Tobacco Industry and Marketing Board (TIMB) highlighting auction and contract sales statistics, in the first 20 days (day 1 to Wednesday 5 May 2021) of this year’s selling season, 64,422,199 kilograms (kgs) were sold against 40,758,377 kgs sold during the same period in 2020, representing a positive variance of 53.06 percent.
In monetary value terms, the golden leaf has fetched US$169,451,894 million over the 20-day period, representing a growth of 84.61 percent compared to US$91,791,410 million during the same period last year.
Last season, tobacco saw an underwhelming performance stemming from various issues chief among them unfavourable weather patterns that affect the quality of the crop and payment disagreements between farmers and the government.
A total of 184kgs were sold last year with total exports coming in at US$713,8 million which was down 5.7 percent from the 2019 figure of US$756,8 million.
This season’s trends show that the golden leaf is poised to surpass the 2020 performance. Also contributing to higher earnings is a global surge in commodity prices as economic activity is picking up from the pandemic-induced slump.
The average price of the crop since the start of the current season to date at US$2.63/kg has also scaled up 16.90 percent from US$2.25/kg same period last year.
At the auction floors, the rejection rate has dropped to 12.81% from 16% during the same period last year, which indicates a better-quality yield produced by farmers this season.
A total of 58,733 bales have been sold so far at the auction floors, up 249% from 16,814 bales sold during the first 20 days of the 2020 selling season. The bales also rank an average weight of 74kgs, slightly outpacing 73kgs in 2020.
At the contract floors where the larger chunk of the crop is now sold through as was effectively done last year, a total of 812,347 bales were sold, up 54.24 percent from 526,672 bales sold during the same period in 2020.
Meanwhile, the number of bales rejected increased by 9.91 percent from 16,577 in 2020 to 18,220, but boost a better average price at US$2.62/kg against US2.25 in 2020.
The firmer US dollar prices are expected to significantly push this season’s total earnings above the prior year to anything less than a billion U.S dollars.
Equity Axis News