Maravi

(NEWZIMBABWE) Chinese buyers boost tobacco prices

Chinese buyers boost tobacco prices
by NewZiana
23/02/2011 00:00:00

THE entry of Chinese buyers has pushed up tobacco prices and spurred competition after breaking up cartels which used to control the sector, Tobacco Industry and Marketing Board (TIMB) chief executive officer Andrew Matibiri has said.

Speaking before the Parliamentary Portfolio Committee on Agriculture, Water, Lands and Resettlement on Tuesday, Matibiri said prices of tobacco continued to firm at the auction floors, largely propelled by growing Chinese demand.

He said the entry of Chinese buyers had been a boon for the tobacco sector, consuming about 40 per cent of the total output last year. "Of the tobacco sold, 40 per cent is going to China, another 40 (per cent) to Europe and the remainder to other parts of the world," he said.

Before the arrival of the Chinese, US$2.99 per kilogramme was the ceiling," he added.

Tobacco is presently fetching an average price of US$3.57 per kg. China is purchasing the crop through the China Tobacco Company, represented in Zimbabwe by Tian Ze.

"Farmers are responding positively and the prices have been favourable mostly attributable to the presence of the Chinese," Matibiri said.

Previously a preserve of White minority farmers, tobacco farming has fast become a favourite of the new indigenous farmers who are beneficiaries of the government's land reforms.

About 60,000 farmers are expected to deliver their crop for sale at the two auction floors this year.

Matibiri said prospects were high that prices would continue to firm.

"We are still in the early days in the marketing season and we expect prices to rise as we get to the upper leaves," he said.

Since the marketing season opened last week, tobacco worth more than US$175 million has been exported.

Labels: ANDREW MATIBIRI, CHINA, TOBACCO

posted by MrK @ 3:22 PM