Tobacco farmers boycott auction

Zimbabwe's tobacco marketing season failed to take off this week as farmers refused to sell at the price offered by merchants at the Tobacco Sales Floors in the capital, Harare. Buyers offered the farmers a maximum of US $0.45 per kg, down from $3 per kg last year, but farmers are demanding not less than $3 per kg and have threatened to withhold their crop until fairer prices are obtained. Of the 1,000 bales brought to auction, only 300 bales had been sold by the time the boycott started. This year's tobacco output is estimated at 80 million kg, well below the Reserve Bank of Zimbabwe (RBZ) estimate of 160 million kg. Farmers have rejected the offered price as uneconomic, arguing that it did not take into account the high cost of inputs, transport and equipment. They also fear they might not be able to repay loans extended to tobacco farmer organisations by the RBZ. Merchants said they had offered a low price because of the poor quality of the leaf. Davison Mugabe, president of the Zimbabwe Commercial Farmers Union (ZCFU), told IRIN he hoped the pricing dispute would be resolved quickly, and in favour of the farmers. "We understand the farmers' plight ... something needs to be done urgently," he said. Agriculture and Rural Resettlement minister Joseph Made said he did not want to comment on the auction boycott. Eddie Cross, an economic analyst and member of the opposition Movement for Democratic Change, said the price wrangle was a sign of deep-seated problems in the tobacco sector; government had to increase support and ensure that selling prices were kept at profitable levels to attract more farmers. "Any farmer who sells at that price [$0.45 per kg] would be committing suicide - in business terms," Cross commented. "Farmers alone cannot revive productivity and viability. They need government support from the growing stage to the marketing stage, including the creation of conditions to ensure that prices remain firm and inclined towards farmer viability."