Malawi tobacco authorities on Wednesday suspended all sales for the country’s top export crop, tobacco, after prices plummeted on Monday.
The action came after farmers on Monday forced the closure of the main auction floor in the administrative capital Lilongwe when prices tumbled to a low of 30 cents per kilo from an average of
$1,60 per kilo over the past two weeks.
The authorities have now appointed a committee to probe prices being paid for tobacco in neighbouring countries.
Godfrey Chapola, the general manager of the industry’s watchdog, the Tobacco Control Commission, said the committee will visit neighbouring Zambia and Zimbabwe to check if similar leaf is fetching the same price being offered here.
Chapola said the market for the crop, which rakes in about 70% of Malawi’s foreign exchange earnings, will not open until discussions are held with relevant stakeholders, including government and the buyers.
He said buyers, who represent foreign companies, claim demand for thin-leaf tobacco was weak on international markets. Malawi is the world’s biggest exporter of burley tobacco, a thin-leafed variety dried in the open air.
”This claim has prompted the commission to compare prices with other countries,” he added. Farmers say 30 cents per kilo was the worst recorded price in
years.
This is the second time farmers have protested over prices this year. They rioted in April at the start of the tobacco auctions, when leaf sold at 60 cents a kilo.
Prices then climbed to $1,80, the highest in three years, before falling back to $1,60, the level two weeks ago.
Tobacco, known as ”green gold” here, earns Malawi more than $190-million annually.
With some 150 000 hectares planted to the leaf,
the industry provides jobs for more than 532 000 Malawians. – Sapa-AFP