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Zim eyes big tobacco crop as new farmers cash in


Tobacco production boost ... Saviour Kasukuwere (centre) with TIMB officials Wednesday

13/02/2013 00:00:00
by AFP I Staff Reporter
 
Call for financial support ... Saviour Kasukuwere
 
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TOBACCO revenue is expected to increase by 16 percent this year as new landowning farmers turn to the valuable export crop, an industry official said on Wednesday.

"We are expecting the total deliveries to reach 170 million kilograms or more and earnings of around $600 million," Monica Chinamasa, chairperson of the Tobacco Industry and Marketing Board told AFP.

That would be up from just over 140 million kilos last year, worth around $517 million, according to the board.

Zimbabwe was once the world's biggest tobacco exporter, with sales accounting for 30 percent of exports. But the country’s often chaotic land reforms, launched in 2000, resulted in a steep drop off in production.

However, the number of registered tobacco growers has almost doubled in the last year to 66,000 with more than 80 percent of the new producers beneficiaries of reforms, Chinamasa said.

The government has urged banks to support fledgling tobacco farmers, who have no access to bank loans because they do not have collateral.

"Most of these farmers are using meagre resources to start production and I believe if the financial services sector were to open up we would see this sector develop," Kasukuwere said as he opened this year’s selling season.

“I have said this before; this kind of attitude must go … banks must support our farmers. They should help farmers to develop and assist them to make sure they can access long term funding,” Kasukuwere said as he officially opened the new selling season.

“If the financial sector were to assist farmers the country would witness an increase in tobacco volumes which are grown every year and an increase in foreign currency earnings.”

The country’s financial sector has largely remained coy over financing agriculture with funding collapsing from 74% before the land reform programme to the current levels of around 17%.

But production of the crop has been rising since 2009, though it remains off a peak in 2000 of 236 million kilos. Output fell to a low point of 56 million kilos in 2006, the weakest performance since independence in 1980.

The sudden collapse of commercial farming caused by the land reforms sent country's already wobbly economy into a tailspin, leading to world-record hyperinflation although the government blames sanctions imposed by the West.



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After the government abolished the Zimbabwe dollar and made the US dollar its currency of reference, farm production stabilised and began ticking upward.

Tobacco remains Zimbabwe's biggest agricultural export, though mining has overtaken farming as the main foreign currency earner.

“The crop accounted for 10,7 percent of the GDP in 2012 and constituted 21,8 percent of all total exports, compared to 9,2 percent for other agriculture commodities. This compares favourably with the 61,8 percent contribution by all minerals combined,” said Kasukuwere.


 
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