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NYABIRA, (Xinhua) -- Workers go about their work at a farm in Nyabira, Mashonaland East, Zimbabwe, while a buyer checks the quality of tobacco during the first day of the marketing season at Boka Tobacco Auction Floors in Harare, March 14, 2017. Zimbabwe’s 2017 tobacco marketing season opened on Wednesday with the highest price of 4.60 U.S. dollars per kg, higher than 3.50 dollars in 2016. The crop is for the first time being sold through the electronic auction system, introduced to improve transparency in tobacco selling. XINHUA PHOTO

Zimbabwe 2017 tobacco marketing season opens with high prices 

HARARE Zimbabwe (Xinhua) -- Zimbabwe’s 2017 tobacco marketing season opened Wednesday with the highest price of 4.60 U.S. dollars per kg, higher than 3.50 dollars last year.

The crop is for the first time being sold through the electronic auction system, introduced to improve transparency in tobacco selling.

The system allows buyers and sellers to conduct their business on-line without physical contact, which in the past has been blamed for collusion on pricing.

Agriculture Minister Joseph Made said the opening price was “a good start for the farmers considering that this is still lower quality leaf.”

He said prices are expected to firm as the selling season progresses.

About 184 million kg would be sold to contract buyers while about 16 million kg will be sold through auction floors, the minister said.

The country is expecting to produce 205 million kg of tobacco in 2017, slightly higher than the 202 million kg last year.

Buyers had secured 700 million U.S. dollars offshore funding to purchase the crop, the biggest export earner for the country.

China has been the biggest buyer of Zimbabwean tobacco leaf, buying over 50 percent of the crop.

Monetary authorities are hopping the tobacco selling season will help improve a cash crisis that has been raging for a year now, which has seen banks capping cash withdrawal limits to as low as 50 dollars per day.

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EARLIER REPORTS:

Zimbabwe government and foreign financial institutions sign investment MOU

HARARE Zimbabwe (Xinhua) -- The government has signed a memorandum of understanding (MOU) with three foreign financial institutions to facilitate investment through joint ventures, state media reported Wednesday.

The Herald newspaper reported that the MOU, which would leverage on the country’s natural resources, was signed by the Chief Secretary to the President and Cabinet Misheck Sibanda and representatives of South Korean institutions Global Trade Finance and Natrabank/Bullion Bank of Africa and the United States-based Rosenthal Group.

Zimbabwe is currently reforming its ease of doing business in a bid to attract foreign investment.

Sibanda said that the three institutions would discuss economic and investment opportunities spanning across financing, development, construction of infrastructure, agribusiness, mining, manufacturing, power, transport and water, among others.

“Against an array of administrative and legislative reforms currently being implemented by government within the context of ease of doing business, it is envisaged that this form and magnitude of investment will turn around the fortunes of the country within the next few years,” Sibanda said.

Global Trade Finance president Kumja Lee said focus would be on investments that created employment and hoped that discussions for the establishment of a bank would start in the next few days.

“We want to help in infrastructure development (and) manufacturing and also take advantage of your vast minerals to create employment for young people,” she said.

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Chinese-funded tobacco farmers in Zimbabwe gear up for 2017 marketing season

HARARE Zimbabwe (Xinhua) -- It is Tuesday afternoon and it’s a hive of activity at one of the farms 60 km northwest of Harare as farm owner Paul Mattison prepares for the 2017 tobacco marketing season which begins this Wednesday.

Just a few hours before the selling season kicks off, Mattison and his managers are busy supervising the workers, some loading harvested tobacco leaves into a curing facility while others are busy grading the cured tobacco.

“I am expecting to produce 500 tonnes of tobacco this season and we have better quality crop when compared to last year. We are, however, down on yields this year due to too much rain and shortage of coal,” said Mattison, one of the 195 farmers contracted by China’s Tianze to grow tobacco in Zimbabwe.

Mattison has been growing tobacco under contract farming with Tianze for 10 years, and has no regrets for choosing to work with the Chinese firm.

“I love Tianze. They are absolutely brilliant. They have funded all the developments here including the tobacco barns and curing facilities,” he said.

“I have done a lot of capital projects this season, spending about 220,000 U.S. dollars on buying new tractors and putting up a grading shade. This was all funded by Tianze,” he added.

One of the few white farmers remaining in Zimbabwe after the land reform program, Mattison said he switched to Tianze after having worked with other companies due to Tianze’s competitive financing and viable prices they offer for tobacco leaf, which is Zimbabwe’s top export earner.

Tianze currently offers the best tobacco prices in Zimbabwe and its cheap money, lent at zero percent deposit, was the best ever deal for tobacco growers in the country, Mattison said.

He was lucky that just a small percentage of his crop, about five percent, was affected by hail storm this year.

He said he hopes to maintain the 170 ha of tobacco in 2018, and to further expand tobacco infrastructure at a farm that is covered under the Bilateral Investment Promotion and Protection Agreement (BIPPA) between Belgium and Zimbabwe.

He said his tobacco farming preparations were being affected by lack of storage space as all the tobacco had matured at the same time due to excessive rains, and hoped the beginning of the selling season would help alleviate the shortage of storage space at his farm.

He had already delivered 2,000 bales for sale to the contractor Tianze in Harare and hoped to pay back in full a 1.1 million U.S. dollars loan he borrowed from Tianze this season.

The 2017 tobacco auction sales begin on March 15 followed by contract sales on March 16.

Mattison’s neighbor Kerry Ruzvidzo was not so lucky this season, as 60 percent of his 130 ha crop was damaged by hail storm and disease.

Tobacco output had therefore reduced by 25 percent from last year, he said.

“I am expecting 400 tonnes of tobacco, down from 500 tons last year. This is the worst year I have heard since I started growing tobacco under Tianze nine years ago,” he said.

Excessive rains, hail storms and an incurable disease caused by the hail storm had seriously affected output and quality of the tobacco crop, he said.

He was also incurring extra costs hiring equipment to fix the road at his farm that had been damaged by excessive rains.

“I will not make any profit this year. I am just fighting to pay back the 1.2 million U.S. dollars I owe to Tianze and hopefully be able to get another contract with the firm next year,” he said.

He said he was not expecting good prices for his spotty tobacco leaf due to its poor quality and added that he will reduce tobacco hectarage to 100 hectares next year due to poor returns this year.

Ruzvidzo said he wants to keep investing in technology in his tobacco farming venture so as to cut labor costs and improve viability.

Both Ruzvidzo and Mattison decried cash shortages in the economy, saying they had affected their ability to pay workers.

“We have resorted to paying them with plastic money but the challenge is that workers are now spending more time looking for money at the banks instead of being at work,” said Mattison.

Tianze, a subsidiary of China Tobacco International, started tobacco contract farming in Zimbabwe in 2005 with the sole purpose of helping revive the country’s tobacco output which had plummeted to a low of 48 million kg in 2008 following the implementation of the land reform program by government in the early 2000s.

Through its support over the years, Zimbabwe’s tobacco output has rebounded and reached 217 million kg in 2014, slightly short of peak production of 231 million kg in 2001.

Tianze has managed to do this through provision of free interest loans, subsidized inputs and quality technical support, among other assistance.

Apart from contract farming, Tianze is involved in auction floor purchasing, processing, warehousing and exporting of tobacco to China. It also sources tobacco from other tobacco merchants in Zimbabwe and export it to China.

Every year, it buys and exports more than 50 percent of Zimbabwe’s tobacco to China.

The number of farmers it supports in Zimbabwe has grown from one in 2005 to the current 305 with hectarage under contract rising from 20 ha to 8,720 ha.

Since inception, the company has injected 40 million dollars annually in interest free loans towards tobacco production, in addition to free technical support, training and other services to its contracted farmers.

Tobacco leaf accounts for 10 percent of Zimbabwe’s Gross Domestic Product, underlining its significance to the country’s economy.

The country is expecting slightly over 200 million kg of tobacco leaf in 2017 from 183 million kg worth 537 million dollars last year.

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246 dead, thousands homeless as flood hits Zimbabwe

HARARE Zimbabwe (Xinhua) -- At least 246 people died and over 2,000 others were left homeless as torrential rains continued to unleash flood in Zimbabwe, a cabinet minister said Thursday.

Local Government, Public Works and National Housing Minister Saviour Kasukuwere appealed for assistance from the international community, development partners and the private sector to address the plight of the affected citizens.

The Zimbabwean government has declared the flooding, so far recorded in southern parts of the country, a state of disaster.

“It is apparent that extra-ordinary measures to alleviate the suffering of citizens of the country in communal, resettlement and urban areas have to be intensified,” he was quoted as saying by state-run news agency.

Zimbabwe has received above-normal rain since the beginning of the 2016/2017 season that has resulted in more that 85 percent of the country’s dams spilling.

The rains are expected to continue until the end of March.

The minister said 2,579 homes, 74 schools and five health institutions had been damaged by floods.

Most of the deaths and destruction have been recorded in Matabeleland North and South provinces, Midlands and Masvingo provinces, he said.

Kasukuwere said shelter, food and nutrition, health facilities, education and road infrastructure were among the issues requiring urgent support while damage assessment was continuing.

He said the government had set up structures from national to district levels to deal with the disaster.

Environment, Water and Climate Minister Oppah Muchinguri said more than 12 million dollars was required to rehabilitate damaged dams and infrastructure for supply of clean water to the people.

“Over 100,000 people are without access to safe drinking water due to destruction of water infrastructure,” she said.

             

 

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