Poor prospects for tobacco production

Prospects for the 2003 tobacco crop, an important foreign currency earner for the country, are poor, the Zimbabwe Tobacco Association (ZTA) warned on Wednesday. Chief executive of the ZTA Chris Molam told IRIN that production had been negatively affected by the government's fast-track land reform programme. "The prospects aren't good for the 2003 tobacco crop ... as a huge number of farmers have been prevented from getting on with the job [of planting tobacco]," Molam said. The planting season for the 2003 crop was currently underway. "We've got a lot of new [small scale, resettled] farmers and their production is difficult to gauge, but overall we are expecting a crop of between 70 million kg to 80 million kg. But it could be as low as 60 million kg if the farmers continue to be prevented from planting and the banks continue to play hard ball," he said. Total tobacco production hit a bumper 260 million kg in 1998. Banks were reluctant to fund farmers because there "were too many risks", which mainly affected large-scale farmers "where the quality production comes from". "We have a problem with funding, banks are nervous as there's a lack of collateral value because the land could be invaded, be listed under a Section 8 [government acquisition] notice anytime," Molam added. A poor tobacco crop would have serious ramifications for Zimbabwe's economy. "If it's 70 million kg, we feel that the auction sale value of the tobacco will be about US $105 million, down from close to US $400 million [in the previous year]. That's pretty dire, it's chopping hugely our ability to pay for imports like fuel. The total national fuel bill is about US $360 million, the value of auction tobacco was at least covering our fuel bill [previously]," Molam said. Zimbabwe has been the world's second largest tobacco producer after Brazil with its golden-yellow "lemon leaf" variety in high demand by blenders. Tobacco accounted for an estimated 31 percent of export earnings in 2001. However, according to the ZTA, if production continues to fall, China and the United States could overtake Zimbabwe by next year. A lot of single-owner commercial farmers who had offered to subdivide their land to share with small-scale resettled farmers had their offers rejected by the government. "They [government] initially were after 5 million hectares and are now taking 11 million hectares [of commercial farm land for redistribution], they are wiping out the commercial farming sector. They are leaving us with about 350 out of 715 farmers able to operate [this season]," he added. The tobacco growers that continued to farm were doing so on reduced hectares. "The cost of production has gone up 152 percent in a year, from October to October, the [inflation measuring] consumer price index is at 139.9 percent. We are going to run short of fuel, we're short of fertiliser ... we've got quite a lot of problems," Molam noted.