Tobacco has already raked in K20 billion in forex in the four weeks of its selling but the Tobacco Commission says the figure could have been higher had it not been for coronavirus (Covid-19) pandemic.
Tobacco Commission chief executive officer Kaisi Sadala said the K20 billion is for 18 million metric tonnes of tobacco sold so far.
He however said this is less nine per cent compared to sales made last year same time.
“We are not moving much tobacco at the auction floors due to the Covid-19, we could have realized much higher if we did not have the coronavirus,” said Sadala.
He, however, said the US$1.53 average price is 30 per cent higher than last year’s average tobacco price, saying this was impressive.
Sadala also expressed worry over the high rate of rejection which he said hovers around 40 per cent.
“The rejection rate on the floors is high because competition is not as high as we had envisioned as most buyers concentrate on securing their contracted tobacco so that they might recoup their loans before participating fully on the auction.
“Initially, it was around 70 – 80 per cent, but now we are averaging 40 – 50 per cent. However, we anticipate reaching acceptable levels of around 20 – 25 per cent,” he said.
He further said another reason is because the new buyer from Zimbabwe (Voedsel) has not yet started buying on the auction because of COVID-19 restriction measures which prevented them to travel to Malawi.
In his remarks, president for Media Network on Tobacco, Alfred Chauwa who is also a Nyasa Times correspondent, said his office has information that some farmers on the contract farming are complaining of high deductions arising from issues that can easily be avoided.