Overproduction gives tobacco buyers excuse to offer low prices – TCC

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The Tobacco Control Commission (TCC) says tobacco buyers usually know they will pay low prices when there is overproduction of the crop.

TCC Chief Executive Officer Kayisi Sadala made the remarks at a media interface on Wednesday in Lilongwe.

Sadala said during the ongoing marketing season there has been an improvement on pricing as average price has increased from US$1.28 Kg in 2018 to US$ 1.48/kg this year.

He however pointed out high rejection rate, overproduction and low prices as some of the challenges they encountered and dealt with during this year’s tobacco marketing season.

“We have seen things improving, the issue of overproduction has been a major problem in the industry in the sense that buyers may be looking for particular amount of tobacco to buy from the country but growers go further to produce too much tobacco. This makes it easier for buyers to give excuses and offer low prices because at the end of the day they know that whatever happens they will get tobacco at low price,” he explained.

He went on to say that in the past it was difficult  to regulate the situation but with the coming of the new Act Tobacco Industry  Act  the commission is able  to limit growers to the quota which they have been allocated and make sure that the farmers are in  line  with the demand.

He then said that they have started registering the farmers to ensure that they become members and sell what they have been   allocated to meet the categories of tobacco marketing which are contract and auction.

According to Sadala, they have been sensitising farmers and conducting awareness programs to make sure that everybody is aware and follows what is required by the law.

This year’s tobacco marketing season started in April and there was a demand of 154 Million kgs against a projected volume of 193 million kgs.

So far, 135 million kgs have already been traded and the commission is expecting to close its markets by the end of September.

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