Tobacco farmers have been knocked sideways after rejection rate hit an average 90 per cent, knocking down the slow recovering economy in the process.
The turbulent tobacco market coincided with the continued depreciation of the kwacha which was at K744 to a US dollar on Thursday and reports of impending increase in fuel prices.
Auction Holdings Limited Corporate Affairs manager Mark Ndipita said rejection rate at Mzuzu Auction Floors hit a record high of 93 per cent on Wednesday.
He said Limbe Auction Floors recorded an 86 per cent tobacco rejection rate, Kanengo Auction Floor tobacco farmer watched helplessly as rejection rate was at 77 per cent while Chinkhoma in Kasungu had a 69 per cent rejection rate.
”At 77.2 rejection rate at Kanengo, this means only seven out of every 100 bales of tobacco were being sold on Wednesday, this is painful,” said Ndipita.
He said there was a meeting on Thursday between the Tobacco Control Commission, buyers and representatives of farmers in a bid to improve the situation.
Ndipita said most of the farmers had taken bank loans. For tobacco farming, had families to take care of.
“The situation is dire, the farmers cannot feed their families, they cannot pay school fees for their children, they do not have peace of mind because of huge loans they obtained in anticipation of better tobacco prices,” he said.
Malawi’s economy depends on agriculture mainly hinges on tobacco sales which rake in forex.