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November, 2006

President's price dictates hurt tobacco market in Malawi
Lilongwe — Tobacco captains have described the just-ended tobacco market season as the worst in many years, attributing this year's low prices to President Bingu wa Mutharika's minimum prices.

The low prices are against Mutharika's vision, who at the opening of the tobacco market dictated to buyers maximum and minimum prices for all tobacco.

But Tobacco Association of Malawi (Tama) president Albert Kamulaga said in an interview that since the buyers did not adhere to the dictates of the president, Mutharika's initiative did not pay expected dividends.

"On the dictates of the president, I would say that since nobody followed the orders [dictates], it did not assist anyone. I am saying this because nobody followed the dictates over pricing. Had buyers followed them, the market would have been better," said Kamulaga.

He said failure by buyers to adhere to the presidential order meant they wanted to show that they do not want to be dictated on prices.

Added Kamulaga: "Buyers looked as if they don't want to be dictated — that is what we have seen of the market and that affected prices. Of course, their explanation has been that the quality on offer and quality [style] on demand were different, but surely they behaved as if they didn't want to be dictated to."

Tobacco Control Commission (TCC) Board Chair Andrew Mzumacharo in a separate interview agreed with Kamulaga, stressing the prices were not reasonable and much had to be done.

"This has been a very bad year, poor prices have dominated the market and the prices were nowhere near the usual," said Mzumacharo. "This is a funny trade, buyers don't base their prices on reality. They have surely not conducted themselves well."

Mzumacharo said despite the fact that prices picked up toward the end of the market season, there were still more reasons to qualify the season as “pathetic.”

Both captains believe the low prices were a disaster and could have long effects on the industry, especially on serious growers.

"Generally, due to the fact that the market has not been good, it is also pathetic to note that most commercial farmers have either withdrawn or reduced normal production levels. Prices were pathetic and as far as I am concerned, those who sold earlier cannot even recover costs. The prices were only better towards the end," said Kamulaga.

Top tobacco buyers have recently come under fire from various stakeholders for their apparent conspiracy to offer low prices on flimsy excuses like low quality and availability of external matters in tobacco bales.

Mutharika himself has called tobacco buyers “thieves” and threatened them with deportation if they continue cheating local farmers through low prices.

United States
Burley taking root in Maryland
UPPER MARLBORO, MD. — Burley tobacco might offer new opportunities for Maryland growers. That’s the word from David Conrad, University of Maryland Extension tobacco specialist, according to a report in American Farm.

Following the passage of the Fair and Equitable Tobacco Reform Act (FETRA) in October 2004, contract burley tobacco production has been offered to Maryland’s tobacco growers resulting in shifts in production from Maryland Type 32 leaf to Burley Type 31 leaf. Like Maryland’s famed Type 32, Burley Type 31 is air-cured and handled in the same way and Conrad, at this stage, said he believes Maryland growers can produce “a quality burley leaf.”

Conrad issued his 2006 tobacco crop report in which he discusses this year’s production of both tobaccos, including seed distribution, varieties, growing conditions, estimated acres planted and curing conditions. Some highlights include:

  • Type 32 seed distribution figures from the Maryland Tobacco Improvement Foundation show that in 2006, only 15 ounces of raw seed were distributed to Maryland growers vs. 146 in 2005.
  • Raw and pelletized seed distribution decreased due to the shift in production from traditional Maryland leaf to burley leaf. Maryland 609 cultivar remains the predominant variety planted for Type 32 leaf. The Maryland 601 and 201 cultivars were also distributed in small amounts.
  • Maryland Type 32 seed continues to remain available through the Maryland Tobacco Improvement Foundation. Tennessee 90 cultivar is the predominant burley variety planted for Type 31 leaf. NC 7 and KT204 are burley cultivars also utilized by Maryland’s tobacco growers.
  • The tobacco crop conditions prior to harvest would fall into the good to excellent range. Based on this information, there was a potential for 30 acres of Maryland Type 32 tobacco under cultivation in 2006. Yields are estimated to be 1,800 pounds per acre producing approximately 54,000 pounds of leaf.
  • Burley Type 31 leaf is estimated to be nearing 1 million pounds of production, averaging 2,400 pounds per acre on 400 acres.

Tobacco International - November, 2006

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