Tobacco set to surpass 2014 post dollarisation record high
By Respect Gwenzi, Jun 28, 2018
Harare – Data from the Tobacco Industry and Marketing Board (TIMB) reveal that 2018 tobacco sales performance has so far surpassed both targets and prior year outturn, as 209.7 million kilograms worth of tobacco was sold as at day 64 which is a 30 percent increase on the same period last year.
The outperformance is attributed to improved weather patterns, improved funding and increased hectorage. While some attribute the gains to increased margins after Government upped its export incentive to 13.5 percent.
Zimbabwe had expected tobacco production to increase by nearly six percent to 200 million kilograms from the 189 kilograms sold in 2017.
Volumes performance is just 3 percent shy of the record 216 million kilograms produced in 2014 and by a fair measure the target is set to be surpassed within the current week.
In terms of contribution, TIMB said 85 percent of the sales volumes went through as contracts sales while the difference was expressed through auctions.
In turn $611.3 million was generated in sales which, a 29 percent increase of the sales value for the comparable period last year.
TIMB also said revenue split maintained a similar ratio to volumes at 85 percent and 15 percent respectively in favour of contracts.
The growth in revenue was as a result of both a surge in volumes and average selling price. The average selling price at $2.91/kilogram has come off by 0.34 percent on last year.
The industry regulator added that tobacco earnings from the 2017 selling season raked in $1.2 billion in exports which is highest recorded earnings by any individual export product, followed by gold in second position.
Government has also announced that in the 2018 season tobacco will be included under the state subsidy program Command agriculture.

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